TKO Group Holdings, which owns UFC, WWE, and PBR, Monday announced that it has entered into an accelerated share repurchase agreement (the “ASR Agreement”) to repurchase $800 million of its outstanding Class A common stock.
The premium sports and entertainment company also announced that it has entered into a 10b5-1 trading plan for the repurchase of up to $174m of its outstanding Class A common stock. In addition, on September 5, the company repurchased approximately $26m of its outstanding Class A common stock under a privately negotiated transaction. Repurchases under the ASR Agreement, the 10b5-1 Plan, and the privately negotiated transaction are being completed under TKO’s previously announced $2bn share repurchase authorization.
“This plan to repurchase $1 billion in shares reflects our conviction in the business and the intrinsic value of our stock,” said TKO president and COO Mark Shapiro. “The repurchases, together with the recent 100% increase to our quarterly cash dividend program, reflect our continued commitment to a robust and sustainable capital return program. We remain focused on executing our balanced capital deployment strategy to deliver long-term value for our shareholders.”
Under the ASR Agreement, on September 16 the company will pay $800m to Morgan Stanley, and expects to receive an initial delivery of 3,161,430 shares of Class A common stock. The total number of shares to be repurchased pursuant to the ASR Agreement will be based on the volume-weighted average price of Class A common stock on specified dates during the term of the ASR Agreement. Transactions under the ASR Agreement are expected to be completed in December.
The company intends to fund the above mentioned share repurchases with proceeds from the $1bn first lien term loan borrowing that closed on September 15.
