Fri, Jan 22, 2016 - Page 13 News List

Pegatron announces plan to buy back its own shares

By Lauly Li  /  Staff reporter

Contract electronics maker Pegatron Corp (和碩) yesterday announced plans to buy back its own shares that have taken a hit amid ongoing market turmoil.

The Taipei-based firm is the first original design manufacturer to announce a buyback scheme this year after the TAIEX dropped below the 10-year average.

Pegatron plans to spend NT$4 billion (US$118.22 million) buying back 50 million shares on the open market in an attempt to protect its shareholders’ interests, the company said in a filing with the stock exchange.

The company’s shares fell 6.67 percent since the beginning of this year and plunged 15.37 percent from a year earlier.

Company board members gave the go-ahead for the buyback plan, which is to take place as long as share prices stand between NT$46.3 and NT$80 per share in the open market, the filing said, adding that the company is to start buying back shares the next time its stock price drops below NT$46.3.

The buyback scheme is to start today and last through March 21, it said, adding that the shares would be canceled after being repurchased.

The company, an assembler of Apple Inc’s iPhones, considered the price-to-earnings (P/E) ratios relatively low and decided to take action to lend support, a Pegatron investor relations official said by telephone.

Pegatron’s P/E ratios stands at about 6.79, considering an earnings per share of NT$9.89 for last year and the company shares’ closing price of NT$67.2 in the local bourse yesterday.

The buyback plan would help the company preserve its capital stock in case it decides to issue new shares in the future, the official said.

This is the second time Pegatron is carrying out a buyback plan.

The company purchased 75 million shares in 2010 when the price of its shares dropped below NT$41.

After purchasing 29.6 million shares, Pegatron ended the buyback scheme as its stock price rose above NT$41 per share.

This story has been viewed 1688 times.

Comments will be moderated. Keep comments relevant to the article. Remarks containing abusive and obscene language, personal attacks of any kind or promotion will be removed and the user banned. Final decision will be at the discretion of the Taipei Times.

TOP top