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Caterpillar repurchasing stock worth $2.5 billion

Caterpillar repurchasing stock worth $2.5 billion

Caterpillar’s strong cash position will allow $4.2 billion worth of stock repurchases by Q3 2014

Caterpillar announced on Tuesday that it has entered into definitive agreements with Société Générale to purchase a total of $2.5 billion of its common stock under accelerated stock repurchase transactions.

In January of 2014, the company announced a similar $1.7 billion transaction, which was completed in March.

Solid financial performance

Caterpillar Chairman and CEO Doug Oberhelman said the solid operational and financial performance of our global team has enabled Caterpillar to return an additional $8 billion of capital to stockholders.

This was enabled though stock repurchase and dividends since the beginning of 2013, and still the company’s balance still remained strong, said Oberhelman.

“Caterpillar has invested more than $30 billion in capital expenditures, research and development, acquisitions and other growth initiatives since 2009, highlighting our commitment to our customers,” said Oberhelman.

He said that the repurchase of an additional $2.5 billion of Caterpillar stock in the third quarter of 2014 will bring the company’s total 2014 stock repurchases to $4.2 billion.

Strong cash position

“This, combined with the 17% increase in our quarterly dividend announced in June, clearly shows how we are taking advantage of our strong cash position to deliver superior returns to stockholders,” said Caterpillar Chairman and CEO Doug Oberhelman.

Pursuant to the terms of the accelerated stock repurchase agreements, Caterpillar has agreed to repurchase a total of $2.5 billion of its common stock from Société Générale, with an immediate delivery of approximately 23 million shares based on current market prices.

The final number of shares to be repurchased and the aggregate cost per share to Caterpillar will be based on Caterpillar’s volume-weighted average stock price during the term of the transactions, which are expected to be completed in September of 2014.

In January of 2014, the Board of Directors authorized the repurchase of $10 billion of Caterpillar stock, which will expire on 31 December 2018.


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