Wendy's International, Inc. today announced the buyback of 2 million shares of its common stock for approximately $98 million in an accelerated share repurchase (ASR) transaction. The common shares were placed into treasury to be used for general corporate purposes.
Following the accelerated share repurchase transaction, the company now has about $1.1 billion remaining under its authorization from its Board of Directors. Since 1998, the Company has bought back more than 42.4 million shares for approximately $1.1 billion, including today's announced transaction, for an average price of $26.44 per share.
"We believe our shares represent an attractive investment opportunity for the company, and this accelerated share repurchase is consistent with our strategy to offset dilution and the strategic initiatives announced on July 29," says Chairman and Chief Executive Officer Jack Schuessler. "Our strong balance sheet and cash position enable us to repurchase our common stock and add value for our shareholders."
The initial price paid per share of the ASR was $49.10. The repurchased shares are subject to a future contingent-purchase price adjustment expected to be settled during the third quarter of 2005. The purchase price adjustment will be based upon the volume weighted average price during the actual repurchase period and is subject to certain provisions that establish a floor and a cap for the average share price in the company's agreement with its broker-dealer, who will execute the repurchase transactions. The company does not expect that the purchase price adjustment will be material. The purchase price adjustment will be reflected in the treasury stock line on the company's balance sheet.
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