(The following appeared on The Journal of Commerce website on May 5, 2011.)
WASHINGTON, D.C. — CSX Corp., the parent company of CSX Transportation, announced it will split its stock, raise the dividend and buy back $2 billion in common shares.
That $2 billion share repurchase, which CSX said starts immediately and should be completed by the end of 2012, equals the amount of capital spending CSX plans for 2011 to upgrade its infrastructure.
The company will split its stock into three shares for each one held now for all shareholders of record at the May 31 close of business, with a distribution date of June 15. That will expand the number of shares to 1.8 billion from 600 million. Its new quarterly dividend will be 38 percent higher at 36 cents a share, or 12 cents on a post-split basis, payable June 15.
CSX shares have recently traded around $77 each, and as much as $80.
The CSX board authorized the company to start buying back shares immediately, under a program CSX expects to complete by the end of 2012. Under the program, the company may purchase shares from time to time on the open market, through block trades or otherwise.
Full story: www.joc.com