STMicroelectronics Announces Status of Common Share Repurchase Program

Rhea-AI Summary

STMicroelectronics announces details of its common share repurchase program, disclosing transactions of 254,839 ordinary shares at a weighted average purchase price of EUR 43.2520 per share, totaling EUR 11,022,290.48. The purpose was to meet obligations from debt financial instruments. The Company now holds 10,271,500 treasury shares, approximately 1.1% of its issued share capital.

Insights

Market Research Analyst

The repurchase of shares by STMicroelectronics signifies a strategic use of their capital to manage their equity structure and potentially signal confidence to the market. The repurchase of 254,839 shares at an average price of EUR 43.2520 represents a small percentage (0.03%) of the total issued share capital, yet it is a substantial financial commitment of over EUR 11 million. This action might be interpreted by investors as a positive indicator, as share buybacks can often lead to an increase in the stock's value due to the reduced number of shares in circulation and the subsequent increase in earnings per share (EPS).

However, the impact on the stock market will largely depend on the prevailing market conditions and investor sentiment towards the semiconductor industry. Given the cyclical nature of the semiconductor market, investors will need to consider broader industry trends, such as demand for electronic components and the competitive landscape, when assessing the potential effect of this buyback on STMicroelectronics' stock price.

Financial Analyst

From a financial perspective, the share repurchase program utilizes company funds to buy back equity, which can be an alternative to distributing dividends as a way to return value to shareholders. The reported average purchase price allows us to gauge the company's valuation at the time of the transactions. The disclosure of these transactions is also a compliance matter with the Market Abuse Regulation, ensuring transparency in the company's dealings.

It's important to note that the shares may be used to meet obligations from debt financial instruments that are exchangeable into equity, which indicates a level of financial engineering to manage the company's capital structure. The treasury shares held by the company, now at 1.1% of the issued share capital, offer a reserve that can be leveraged for future strategic moves such as acquisitions, employee compensation, or to defend against hostile takeover attempts.

Investors should consider the long-term implications of the buyback on the company's balance sheet and liquidity, as well as the opportunity cost of not investing the capital elsewhere. The repurchase program should be evaluated in the context of the company's overall financial health, including its cash flow, debt levels and investment needs.

  

STMicroelectronics Announces Status of
Common Share Repurchase Program

Disclosure of Transactions in Own Shares – Period from Mar 11, 2024 to Mar 15, 2024

AMSTERDAM – March 18, 2024 -- STMicroelectronics N.V. (the “Company” or “STMicroelectronics”), a global semiconductor leader serving customers across the spectrum of electronics applications, announces full details of its common share repurchase program (the “Program”) disclosed via a press release dated July 1, 2021. The Program was approved by a shareholder resolution dated May 27, 2021 and by the supervisory board.

STMicroelectronics N.V. (registered with the trade register under number 33194537) (LEI: 213800Z8NOHIKRI42W10) announces the repurchase (by a broker acting for the Company) on the regulated market of Euronext Paris, in the period between Mar 11, 2024 to Mar 15, 2024 (the “Period”), of 254,839 ordinary shares (equal to 0.03% of its issued share capital) at the weighted average purchase price per share of EUR 43.2520 and for an overall price of EUR 11,022,290.48.

The purpose of these transactions under article 5(2) of Regulation (EU) 596/2014 (the Market Abuse Regulation) was to meet obligations arising from debt financial instruments that are exchangeable into equity instruments.

The shares may be held in treasury prior to being used for such purpose and, to the extent that they are not ultimately needed for such purpose, they may be used for any other lawful purpose under article 5(2) of the Market Abuse Regulation.

Below is a summary of the repurchase transactions made in the course of the Period in relation to the ordinary shares of STMicroelectronics (ISIN: NL0000226223), in detailed form.

  

Transactions in Period

Dates of transaction	Number of shares purchased	Weighted average purchase price per share (EUR)	Total amount paid (EUR)	Market on which the shares were bought (MIC code)
3/11/2024	50,000	43.1343	2,156,715.00	XPAR
3/12/2024	50,000	43.9706	2,198,530.00	XPAR
3/13/2024	51,450	44.0904	2,268,451.08	XPAR
3/14/2024	51,492	43.3069	2,229,958.89	XPAR
3/15/2024	51,897	41.7873	2,168,635.51	XPAR
Total for Period	254,839	43.2520	11,022,290.48

Following the share buybacks detailed above, the Company holds in total 10,271,500 treasury shares, which represents approximately 1.1% of the Company’s issued share capital.

In accordance with Article 5(1)(b) of the Market Abuse Regulation and Article 2(3) of Commission Delegated Regulation (EU) 2016/1052, a full breakdown of the individual trades in the Program are disclosed on the ST website (https://investors.st.com/stock-and-bond-information/share-buyback).

About STMicroelectronics
At ST, we are over 50,000 creators and makers of semiconductor technologies mastering the semiconductor supply chain with state-of-the-art manufacturing facilities. An integrated device manufacturer, we work with more than 200,000 customers and thousands of partners to design and build products, solutions, and ecosystems that address their challenges and opportunities, and the need to support a more sustainable world. Our technologies enable smarter mobility, more efficient power and energy management, and the wide-scale deployment of cloud-connected autonomous things. We are committed to achieving our goal to become carbon neutral on scope 1 and 2 and partially scope 3 by 2027. Further information can be found at www.st.com.

For further information, please contact:

INVESTOR RELATIONS:
Céline Berthier
Group VP, Investor Relations
Tel: +41.22.929.58.12
celine.berthier@st.com

MEDIA RELATIONS:
Alexis Breton        
Corporate External Communications
Tel: +33.6.59.16.79.08
alexis.breton@st.com

Attachment

• C3242C -- Mar 18 2024 -- Disclosure of transactions in Own Shares PR_FINAL FOR PUBLICATION

FAQ

What is the purpose of STMicroelectronics' common share repurchase program?

The purpose was to meet obligations arising from debt financial instruments that are exchangeable into equity instruments.

How many ordinary shares were repurchased by STMicroelectronics in the specified period?

STMicroelectronics repurchased 254,839 ordinary shares in the period from Mar 11, 2024, to Mar 15, 2024.

What is the total amount paid for the repurchased shares by STMicroelectronics?

The total amount paid for the repurchased shares by STMicroelectronics was EUR 11,022,290.48.

How many treasury shares does STMicroelectronics currently hold?

STMicroelectronics currently holds 10,271,500 treasury shares, representing approximately 1.1% of the Company's issued share capital.

Where can the detailed breakdown of individual trades in the share repurchase program be found?

The detailed breakdown of individual trades in the share repurchase program can be found on the ST website at https://investors.st.com/stock-and-bond-information/share-buyback.