Essity's New Share Buyback Program
Essity's Board of Directors has made a significant decision to initiate a new program aimed at repurchasing Class B shares valued at SEK 3 billion. This program follows the authorization received during the recent Annual General Meeting. The buyback is set to commence shortly and is part of Essity's ongoing strategy to enhance shareholder value.
Financing the Share Repurchase
The funding for this share buyback will be sourced from the company's operational cash flow, ensuring that the ordinary dividend is maintained. This reflects Essity’s commitment to integrating share repurchases as a normal aspect of its financial management strategy.
Management of the Program
To ensure independence and efficiency, BofA Securities Europe SA will oversee the management of this buyback initiative. The timing of share repurchases will be determined by them without any influence from Essity itself. All transactions will occur on Nasdaq Stockholm, adhering strictly to the issuer regulations set by the stock exchange, as well as the EU Market Abuse Regulation (MAR) and the Safe Harbour Regulation.
Conditions of the Buyback
There are several key conditions attached to this share buyback program. The shares will only be acquired at current market prices on Nasdaq Stockholm. This price will be determined by the highest buying price and the lowest selling price available at any moment in time.
Cash Payments for Shares
All repurchased shares will be settled in cash. This approach ensures clarity and simplicity in transactions.
Limitations on Share Purchases
In accordance with the authorization from the Annual General Meeting, the buyback program is capped at a maximum of 10% of the total number of shares outstanding at any point in time. Ultimately, the shares repurchased are expected to be canceled, thus enhancing the value of the remaining shares.
Currently, Essity's total shares amount to 693,054,489, comprising 58,973,654 Class A shares and 634,080,835 Class B shares. Notably, Essity holds an existing inventory of 782,500 Class B shares in treasury.
Transparency and Reporting
To maintain transparency during this process, Essity plans to publish comprehensive information regarding the repurchase each week on its official website.
This decision represents an important step in Essity's strategic direction to reward shareholders while reinforcing the company’s financial health. Overall, this share buyback program embodies the strategic steps Essity is taking to ensure that it remains competitive and retains investor confidence in the market.
Frequently Asked Questions
What is the total value of the share buyback program?
The share buyback program is valued at SEK 3 billion.
Who is managing the buyback program?
BofA Securities Europe SA is managing the share buyback program independently of Essity.
How will the share repurchases be financed?
The share repurchases will be financed through cash flow generated from ongoing operations, ensuring stability in the dividend.
What is the maximum percentage of shares that can be repurchased?
The authorization limits share repurchases to a maximum of 10% of the total outstanding shares.
When can we expect updates on the buyback program?
Essity will provide updates on the share repurchases weekly via their official website.
