Diageo plc has commenced the next phase of its previously announced return of capital (ROC) programme of up to £4.5 billion (€5.4 billion) to shareholders, which will be completed during the fiscal year 2023.
Under the first two phases of the ROC programme, the Guinness maker repurchased shares with an aggregate value of £2.25 billion (€2.70 billion).
UBS Agreement
Diageo has entered into a non-discretionary agreement with UBS AG London Branch (UBS) to enable the company to buy back shares with an aggregate value of up to £1.7 billion (€2 billion).
The brewer plans to complete the repurchase of shares with an aggregate value of up to £1.4 billion (€1.7 billion) out of this total by 30 June 2022.
In each case, the aggregate value of shares repurchased will be net of any fees payable to, or, by UBS under the terms of the agreement.
This agreement will commence on 21 February 2022 and will end no later than 5 October 2022, Diageo noted.
The purpose of the repurchases is to reduce the share capital of Diageo and all shares repurchased under this agreement will be cancelled.
Further execution phases of the ROC programme, utilising the most appropriate mechanic of either share buybacks or special dividends depending on market conditions, will be subject to future announcements from Diageo.
Future Diageo Share Buybacks
UBS will make its trading decisions in relation to Diageo’s securities independently of and uninfluenced by Diageo.
Any repurchase of shares by Diageo will be carried out on the London Stock Exchange and/or other recognised investment exchange(s).
This latest phase of the ROC programme will occur within the limitations of Diageo’s existing general authority to repurchase up to 233,611,282 shares, granted at its 2021 Annual General Meeting.
After taking account of the number of shares bought back under the second phase of the ROC programme, the maximum number of shares that can be bought back under this authority under the third phase of the ROC programme is 217,037,150, the spirits giant added.
