AOL didn’t want to jump on the share-repurchase bandwagon. On Tuesday morning, CFO Artie Minson told analysts that the company preferred to use its cash to invest in “future growth” instead of buybacks. But AOL has lost more than 32% of its market value since then, closing Wednesday at $10.22: It reported an 11 cent-per-share loss in 2Q instead of the 4 cent profit that analysts expected. Do you think a $250M repurchase is enough to stop the bleeding? Here’s the release:
New York, NY – August 11, 2011 – AOL Inc. (NYSE: AOL) today announced that its Board of Directors has approved a $250 million stock repurchase program, effective August 10, 2011.
“We believe this stock repurchase makes sense for both our company and our shareholders” said Tim Armstrong, Chairman and CEO. “We are continuing the disciplined execution of our strategy and have confidence in our future growth prospects.”
“This announcement highlights our strong balance sheet and solid cash flow generation,” said Artie Minson, CFO. “We believe this is a unique opportunity to invest in our company.”
Under the program, AOL is authorized to repurchase up to $250 million of its outstanding shares of common stock from time to time over the next 12 months. The timing and amount of any shares repurchased will be determined by the Company’s management based on its evaluation of market conditions, the trading price of the stock and other factors. The repurchases may be made on the open market, in block trades or otherwiseand may include derivative transactions. The repurchase program may be suspended or discontinued at any time.
Subscribe to Deadline Breaking News Alerts and keep your inbox happy.