(Source: CN press release, October 27, 2015)
MONTREAL — CN announced today that its Board of Directors has approved a new share repurchase program. CN believes that the repurchase of its shares represents an appropriate and beneficial use of the Company’s funds.
Luc Jobin, CN executive vice-president and chief financial officer, said: “We are confident in our ability to generate strong cash flow from operations to support steady investments in safety, growth and productivity, maintain a strong balance sheet and drive shareholder value creation. Since its privatization in 1995, CN has increased its dividends per share by 17 per cent on average every year for 19 consecutive years and, since 2000, has created significant shareholder value through regular share repurchases. CN’s new share repurchase program is a reflection of our on-going commitment to shareholders.”
The new normal-course-issuer bid (Bid) permits CN to purchase, for cancellation, up to 33 million common shares, representing 4.9 per cent of the 679,543,061 common shares issued and outstanding of the Company not held by insiders on Oct. 16, 2015. On that date, 793,033,310 CN common shares were issued and outstanding.
The Bid – starting on Oct. 30, 2015, and ending no later than Oct. 29, 2016 – will be conducted through a combination of discretionary transactions and automatic repurchase plans through the facilities of the Toronto and New York stock exchanges, or alternative trading systems, if eligible, and will conform to their regulations.
Toronto Stock Exchange (TSX) rules will permit CN to purchase daily, through TSX facilities, a maximum of 365,471 common shares under the Company’s Bid. Purchases under the Bid will be made by means of open market transactions or such other means as the TSX or a securities regulatory authority may permit, including private agreements or share repurchase programs under one or more issuer bid exemption orders issued by securities regulatory authorities in Canada.
The price to be paid by CN for its open market purchases of common shares will be the market price at the time of acquisition, plus brokerage fees. Purchases made under issuer bid exemption orders will be at a discount to the prevailing market price as per the terms of the order.
CN repurchased 23 million common shares under its share repurchase program announced in October 2014, at a weighted-average price of C$75.93 per share, excluding brokerage fees, returning C$1.75 billion to its shareholders.
CN also announced today that its Board of Directors has approved a fourth-quarter 2015 dividend on the Company’s common shares outstanding. A quarterly dividend of thirty-one-and-one-quarter cents (C$0.3125) per common share will be paid on Dec. 31, 2015, to shareholders of record at the close of business on Dec. 10, 2015.