FINDLAY, Ohio (March 1, 2016) — Cooper Tire & Rubber Co. has increased its existing share repurchase program and extended its life by authorizing the repurchase of up to $200 million of the company's outstanding common stock through Dec. 31, 2017.
The $200 million authorization, which replaces the $74 million remaining on the authorization from February 2015, is being carried out as part of management's plan to “deliver value to shareholders.”
The increased authorization is approximately 10 percent of the current market capitalization, Cooper said. The tire maker's shares were trading at $39.92 at mid-day on Feb. 29.
“Cooper is in a strong financial position and these share repurchases, coupled with our ongoing quarterly dividend, demonstrate our commitment to continuing to deliver value to shareholders,” said Roy Armes, Cooper chairman, CEO and president.
“They also represent key components of our balanced approach to capital allocation as we plan to invest in our business, opportunistically pursue value-enhancing acquisitions, and return capital to shareholders to drive value over the long term,” he added.
Shares will be purchased from time to time based on market conditions and will be executed through open market purchases, privately negotiated purchases, and other means. All or part of the repurchases may be implemented under Rule 10b5-1 trading plans, which allow repurchases under preset terms when the company might otherwise be prevented from doing so.
The repurchased shares will be held in Treasury and used for general corporate purposes.
Findlay-based Cooper completed $126 million in share repurchases through Feb. 19, 2016, under the previous $200 million authorization announced in February 2015. Under that program, the company bought approximately 3.2 million shares at an average price of $38.92 per share.
That program followed a $200 million accelerated share repurchase program announced in August 2014. In total, Cooper has repurchased approximately 9.6 million shares at an average price of $34 under these programs, which amounted to 15 percent of the outstanding shares as of August 2014.
As of Feb. 19, 2016, Cooper had approximately 55.4 million outstanding common shares.