LSEG Shares Surge on $633.8 Million Share Buyback

London Stock Exchange Group (LSEG) shares rose on Thursday after the company announced a new share buyback program worth $633.8 million (£500 million). The buyback, which is expected to be phased over multiple tranches over a period of up to 12 months, is being funded using the proceeds of the divestment of the BETA business.

In connection with the first tranche of the buyback, LSEG has entered into an irrevocable agreement with Goldman Sachs International to purchase Shares with a value of up to £250 million. Purchases will commence immediately and will end no later than 5 December 2022. Goldman Sachs will make trading decisions independently of, and uninfluenced by, the Company with regard to the timing of the purchases of Shares.

The buyback is expected to reduce the share capital of the Company and is being conducted on the London Stock Exchange and/or on Turquoise Equities Trading. Shares purchased by Goldman Sachs will be on-sold by Goldman Sachs to the Company, and any purchases of Shares by the Company from Goldman Sachs will be carried out on the London Stock Exchange, with the Shares purchased by the Company being held in Treasury.

BCP York Holdings (Delaware) L.P., York Holdings II Limited, and York Holdings III Limited, entities owned by a consortium of certain investment funds affiliated with Blackstone Inc., have notified the Company of their intention to participate in the Buyback in line with one of the exceptions to the lock-up provisions contained in the Relationship Agreement entered into with, among others, the Consortium on 29 January 2021 in connection with completion of the Refinitiv acquisition.

The share buyback program is expected to have a positive impact on LSEG's earnings per share (EPS) and return on equity (ROE) in the coming years. By reducing the number of outstanding shares, the company's earnings are spread across a smaller base, leading to an increase in EPS. Additionally, the reduction in share capital increases the equity base relative to the company's earnings, improving the company's ROE.




In conclusion, LSEG's share buyback program is a strategic move that aligns with the company's overall investment philosophy, focusing on generating returns for shareholders while maintaining a strong balance sheet. The program helps the company to optimize its capital allocation, create value for shareholders, reduce the share overhang, and ultimately support its long-term growth strategy.