News > Companies
Big names in buybacks
September 17, 2001: 1:54 p.m. ET

GE, Intel, other companies take advantage of relaxed regulations
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NEW YORK (CNNfn) - A host of big-name companies, including Intel Corp. and General Electric Co., took advantage of relaxed regulations Monday to accelerate share repurchasing programs and stabilize shares in the face of last week's terrorist attacks.

GE (GE: down $4.16 to $35.19, Research, Estimates) said it would increase activity on its $22 billion repurchasing program which began in December 1994. The company has about $2.8 billion left in that program.

"It's appropriate to step up our current activity and affirm our faith in the long-term prospects of the company," said Jeff Immelt, GE chairman and CEO, in a statement.

Chipmaker Intel (INTC: down $2.29 to $23.78, Research, Estimates) increased the number of shares it plans to repurchase by 300 million. Intel previously had 63 million shares available for repurchasing under a program it began in 1990.

Compaq Computer Corp. (CPQ: down $1.67 to $8.68, Research, Estimates) said it is resuming its stock buyback program, which was halted during negotiations of the Hewlett-Packard merger agreement. Compaq has $550 million left to spend from its $1 billion plan.

The Walt Disney Co. (DIS: down $3.96 to $19.62, Research, Estimates) has been repurchasing its shares on Monday and will use a portion of proceeds from its $1 billion bond offering to fund the purchases under a current authorization, said CFO Thomas Staggs.

Disney currently has a stock buyback plan authorizing it to repurchase 385 million shares.

Morgan Stanley (MWD: down $6.07 to $42.83, Research, Estimates) said it expects to use some or all of the $1 billion it has authorized for repurchasing.

Pepsico (PEP: up $0.10 to $47.00, Research, Estimates) also announced plans to resume a stock buyback program. The No. 2 U.S. soft drink manufacturer said it now plans to repurchase up to $2 billion of its shares under the federal government's emergency relief efforts.

And insurer The Allstate Corp. (ALL: down $1.33 to $32.75, Research, Estimates) said it planned a new $500 million buyback to be completed by the end of 2002.

The previous buyback program was a $2 billion program that was completed on Sept. 5, 2001.

PepsiCo had rescinded its share repurchase program in December to qualify its planned merger with the Quaker Oats Co. for pooling-of-interests accounting treatment. The merger was completed on August 2.

Seattle-based coffee retailer Starbucks (SBUX: Research, Estimates) said before the opening bell Monday that its board has authorized the repurchase of $60 million of the company's common stock.

On Friday, the U.S. Securities and Exchange Commission eased the rules to allow publicly traded companies to repurchase their shares without meeting the usual volume and timing restrictions. Repurchases also will not be subject to adverse accounting consequences.

At least 33 firms have announced buybacks, including First Data Corp. (FDC: Research, Estimates), AIG Insurance (AIG: Research, Estimates), H&R Block (HRB: Research, Estimates), and North Fork Bancorp Inc. (NFB: Research, Estimates)

Electronics parts manufacturer Sanmina Corp. (SANM: Research, Estimates) said earlier Monday it also plans to repurchase up to 5 percent of its common stock. Its shares closed at $14.57 last Monday, before the attacks. Networking equipment maker Cisco Systems Inc. (CSCO: Research, Estimates) and bank holding company FleetBoston Financial Corp. (FBF: Research, Estimates) announced buyback plans last week.

Solectron also set a buyback plan Monday for up to $200 million of stock. graphic

-- from staff and wire reports


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