Samsung makes investors happy with $1bn share buyback
Aiming to secure stock price stability after recent falls
Samsung has announced a plan to buy back $2bn worth of its shares, after investors pressured the firm for higher returns.
The Korean chaebol will buy back 1.65 million common shares and 250,000 preferred shares in its first buyback since 2007, and the second-largest ever.
Sammy said in a regulatory filing the stock repurchases would increase shareholder value and secure share price stability for the firm.
The company has faced increasing shareholder calls for better returns as investors fear for its value as its profits start to fall.
Sammy’s stellar smartphone division has started to falter and this year will be its worst annual profit for three years, spooking shareholders that it might be Peak Samsung already.
The company’s stock is down 12.5 per cent this year, hence it needs to give its investors something to get excited about.
Aside from the share buyback, Sammy is also expected to increase its dividend payouts to keep stockholders sweet. ®