Uber (UBER.US) has announced a $1.5 billion accelerated stock repurchase plan.
1min read Uber (UBER.US) announced on Tuesday that it has signed an Accelerated Filer (ASR) agreement to repurchase $1.5 billion of common stock. The accelerated repurchases are part of the $7 billion stock repurchase authorization previously announced. The news boosted Uber's stock price by nearly 5% before the market opened on Monday.
Under the ASR agreement, Uber will pay $1.5 billion to the dealer and expects to receive an initial delivery of 18,578,727 shares of common stock, representing approximately 80% of the common stock that Uber expects to repurchase under the ASR agreement. The total number of shares of common stock repurchased by Uber under the ASR agreement will be based on the volume-weighted average price of Uber's common stock on specified dates during the term of the ASR agreement.
The transactions under the ASR agreement are expected to be completed in the first quarter of 2025.
"We are entering 2025 with significant momentum and expect to continue to significantly expand our free cash flow, allowing us to return meaningful capital to shareholders while investing in growth," said Prashanth Mahendra Rajah, Uber's chief financial officer.
"Our stock is undervalued relative to our business strength, and we plan to accelerate repurchases under our existing authorization. This ASR represents a value-enhancing capital allocation, equivalent to over 1% of our market capitalization."