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Intention to Repurchase Shares
The Company currently intends to purchase up to $3.1 billion in value of its Common Stock through both a modified "Dutch auction" tender offer for up to $2.0 billion of its Common Stock and a separate share purchase agreement (the "Purchase Agreement") with a subsidiary of The Coca‑Cola Company. The Company expects the price range for the tender offer to be $850 to $925 per share of Common Stock.
Under the Purchase Agreement, the Company has agreed to buy, and a subsidiary of The Coca‑Cola Company has agreed to sell, at a purchase price equal to the price paid by the Company in the tender offer, a number of shares of Common Stock such that The Coca‑Cola Company would beneficially own 21.5% of the Company's outstanding shares of Common Stock after the repurchase and completion of the tender offer. The purchase of shares under the Purchase Agreement is conditioned on the purchase price applicable to the tender offer and the Share Repurchase being no less than $925 per share. Should the applicable price in the tender offer be less than $925 per share, The Coca‑Cola Company shall have the option, but not the obligation, to sell their shares at that price. The tender offer is expected to be launched on or about May 20, 2024 and the purchase of shares under the Purchase Agreement is expected to occur on the 11th business day following the expiration of the tender offer.
"We believe that the proposed share repurchase enables us to optimize our balance sheet by raising a prudent amount of debt in order to return cash to stockholders," said Mr. Harrison. "We intend to utilize our solid financial position and projected strong cash flow to delever over the coming years while maintaining our current regular quarterly dividend and a solid investment grade rating profile."
J. Frank Harrison, III will not participate in the tender offer with respect to the Common Stock he beneficially owns.
The Company intends to fund the repurchase with a combination of new funded debt and cash on hand.
| (a) | All comparisons are to the corresponding period in the prior year unless specified otherwise. |
| (b) | The discussion of the operating results for the first quarter ended March 29, 2024 includes selected non-GAAP financial information, such as "comparable" and "adjusted" results. The schedules in this news release reconcile such non-GAAP financial measures to the most directly comparable GAAP financial measures. |
Posted In: COKE
