Norsk Hydro: Initiation of share buyback program

Rhea-AI Summary

Norsk Hydro ASA (NHYDY) has announced a significant share buyback program, authorized by its Board of Directors. The program aims to repurchase up to 100 million shares with a maximum value of NOK 2 billion (approximately 1.8% of the company's market value). Set to commence on September 11, 2024, and conclude by February 28, 2025, the buyback will reduce Norsk Hydro's share capital, subject to General Meeting approval. The price range for repurchases is set between NOK 20 and NOK 150 per share. Notably, the Norwegian State's ownership will remain unchanged through a pro-rata redemption agreement. Citigroup Global Markets Europe AG will independently manage the buyback, adhering to EU Market Abuse Regulation guidelines.

Positive

• Share buyback program of up to 100 million shares, potentially increasing shareholder value
• Maximum buyback value of NOK 2 billion, representing 1.8% of company's market value
• Program aims to reduce share capital, potentially boosting earnings per share
• Agreement with Norwegian State ensures stable government ownership post-buyback

Negative

• Significant cash outlay of up to NOK 2 billion for share repurchases
• Potential opportunity cost as funds used for buyback cannot be invested in operations or growth

The Board of Directors of Norsk Hydro ASA has resolved to initiate a share buyback program to service its shareholders by way of reducing its share capital. The share buyback program will be executed in accordance with the authorization granted to the Board of Directors by the Annual General Meeting of Norsk Hydro held on May 7, 2024.

The share buyback program covers purchase of up to 100,000,000 shares with a maximum value of NOK 2,000 million, inclusive of the proportional redemption of shares owned by the Norwegian State. NOK 2,000 million is equivalent to approximately 1.8% of the market value of the share capital in Norsk Hydro at the current share price level.

The buyback program will commence September 11, 2024 and is planned finalized within February 28, 2025, with the authorization being valid until June 30, 2025. The shares repurchased under the buyback program will be redeemed (cancelled) by way of a share capital decrease in Norsk Hydro, subject to approval by Norsk Hydro's General Meeting.

The minimum and maximum amounts that can be paid per share shall be NOK 20 and NOK 150, respectively.

Norsk Hydro has entered an agreement with the Norwegian State according to which the Norwegian State's shares will be redeemed on a pro-rata basis to ensure that the Norwegian State's ownership is unchanged when shares are cancelled.

Norsk Hydro has engaged Citigroup Global Markets Europe AG to manage and carry out the share repurchases in the market. Citigroup Global Markets Europe AG will make its trading decisions independently of, and uninfluenced by, Norsk Hydro.

The share buyback program is carried out in accordance with the Market Abuse Regulation (EU) No 596/2014 ("MAR") and Commission Delegated Regulation (EU) No 2016/1052 ("Safe Harbour Regulation").

Investor contact:   
Martine Rambøl Hagen  
Head of Investor Relations  
+47 91708918  
Martine.Rambol.Hagen@hydro.com 

This information is made public by Norsk Hydro pursuant to the EU Market Abuse Regulation and subject to the disclosure requirements pursuant to Section 5-12 of the Norwegian Securities Trading Act.

FAQ

What is the size of Norsk Hydro's (NHYDY) share buyback program announced in 2024?

Norsk Hydro's share buyback program covers the purchase of up to 100,000,000 shares with a maximum value of NOK 2,000 million (approximately 1.8% of the company's market value).

When will Norsk Hydro's (NHYDY) 2024 share buyback program start and end?

The share buyback program will commence on September 11, 2024, and is planned to be finalized by February 28, 2025, with the authorization valid until June 30, 2025.

What is the price range for Norsk Hydro's (NHYDY) share repurchases in the 2024 buyback program?

The minimum and maximum amounts that can be paid per share in the buyback program are NOK 20 and NOK 150, respectively.

How will Norsk Hydro's (NHYDY) 2024 share buyback program affect the Norwegian State's ownership?

Norsk Hydro has entered an agreement with the Norwegian State to redeem its shares on a pro-rata basis, ensuring that the State's ownership percentage remains unchanged when shares are cancelled.