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Royal Philips, a global leader in health technology, announced that it will repurchase up to 2 million shares to cover long-term incentive and employee stock purchase plans. At the current share price, the shares amount to approximately EUR 91 million ($110.8 million).
The repurchase is a part of the plan announced on January 29, 2019, during its annual results. It was proposed to increase dividend by 6% to EUR 0.85 per share, with the start of a new EUR 1.5 billion share buyback program.
The repurchases will be executed through one or more individual forward transactions, to be entered into in the course of the second quarter of 2021, under the Market Abuse Regulation and within the limits of the authorization granted by the company’s General Meeting of Shareholders on May 6, 2021, announced the company.
Philips expects to take delivery of the shares in 2023.
The distribution will be payable in cash or in shares, at the option of the shareholder, against the net income for 2020. The shares will trade ex-dividend at Euronext Amsterdam and the New York Stock Exchange.
The number of share dividend rights will be determined based on the volume-weighted average price of all traded common shares at Euronext Amsterdam on June 2, 3 and 4, 2021.
The ratio and the number of shares to be issued will be announced on June 8, 2021. People could indicate their choice of cash or receiving additional shares by May 12.
Dividend in cash is subject to 15% tax, which will be deducted from the dividend in cash paid to the shareholders at the par value of the shares (which value amounts to EUR 0.20 per share).
Holders of ordinary shares in the form of K-shares who wish to collect their dividend after June 8, 2021, will receive it in cash.
According to the company, 50.3% of the program has been completed through repurchases. This new announcement will cover the rest.
By using forward transactions, Philips aims to optimize the number of shares to be repurchased under the program to maintain its current liquidity and reduce any further impact of COVID-19 pandemic on its finances.
In related news, Royal Philips announces some innovative digital imaging products at EuroPCR 2021 (May 18-20). During the virtual event, Philips showed three new innovative products integrating digital imaging with software platforms for better cardiac care.
“At Philips we envision personalized, efficient and clinically smart cardiac care that drives optimal outcomes throughout the patient journey,” said Bert van Meurs, Chief Business Leader for Image-Guided Therapy at Philips. “At this year’s virtual EuroPCR we’re showcasing how we bring together devices, systems, software and services that improve cardiac care by strengthening clinical confidence, building efficiency throughout the care pathway and improving the experience for both patients and staff.”
The new Philips Interventional Applications Platform called IntraSight Mobile brings together imaging and physiology applications on a mobile system for coronary and peripheral artery disease therapy.
It also launched Philips Omniwire Pressure Guide Wire, the world’s first solid-core pressure wire for coronary artery interventions. It will be available in Europe, initially.
Philips also showcased its new Laser System, which offers plug-and-play simplicity for coronary procedures. The system can be used for lead extraction, that is, the removal of pacemaker or defibrillator leads around the heart, a first of its kind.