CLERMONT-FERRAND, France (Sept. 11, 2015) — Group Michelin is proceeding with a plan to buy back up to $225 million worth of company shares and retire them.
Compagnie Générale des Etablissements Michelin, the firm's corporate entity in France, is enlisting the assistance of an unnamed investment services provider to faciliate a buyback program authorized by shareholders at Michelin's annual meeting on May 22.
The unnamed provider will carry out the plan between Sept. 10 and Dec. 15, Michelin said, at an average price “to be determined objectively and independently by the market over the duration of the agreement, less a guaranteed discount.”
The price may not exceed the maximum purchase price of 140 euros ($158 at prevailing exchange rates) approved by the shareholders.
The proposal approved also limits the number of shares to be repurchased to no more than 10 percent of the total shares outstanding at the time of each transaction and restricts the company from holding more than 10 percent of its own share capital at any time.
The objectives of the buyback program are:
- To purchase shares for sale or allocation to employees of group companies in accordance with the conditions set down by law;
- To maintain a liquid market for the company's shares through a liquidity contract complying with a code of ethics approved by the French financial authority AMF.
- To purchase shares for allocation on exercise of rights attached to securities redeemable, convertible, exchangeable or otherwise exercisable for shares of the company.
- To purchase shares to be held and subsequently sold, exchanged or otherwise transferred in connection with external growth transactions. The maximum number of shares purchased for the purpose of being held and subsequently sold or exchanged in connection with a merger, de-merger or asset contribution may not exceed 5 percent of the company's share capital.
- To implement any other market practices that may be authorized in the future by the applicable laws and the AMF.
- To acquire shares for cancellation under a shareholder-approved capital reduction.
All of the shares bought back under the agreement will be cancelled, according to terms of another resolution approved at the company's annual meeting.