Canadian Consulting Engineer

AECOM buys back its own shares

AECOM Technology Corp, the consulting engineering corporate giant that employs over 4,300 people in Canada, announced on August 16 that it is repurchasing up to $200 million of its common stock on the New York Stock Exchange.

August 22, 2011   Canadian Consulting Engineer

AECOM Technology Corp, the consulting engineering corporate giant that employs over 4,300 people in Canada, announced on August 16 that it is repurchasing up to $200 million of its common stock on the New York Stock Exchange.

The first $100 million involves a transaction with Bank of America. In a press release, Michael S. Burke, AECOM executive vice president and chief financial officer, said:  “The accelerated share repurchase agreement enables us to immediately execute an accretive transaction that will benefit our shareholders. Given our strong balance sheet and outlook, we can execute the share repurchase program and continue making strategic investments in the business while remaining well within our targeted leverage ratio range of 1.5 to 2.0 times net debt to EBITDA.”

What does this mean for AECOM employees who own stock in the company?

Paul Dickard of the New York office of AECOM explained that the strategy is to raise the value of the shares. Given the current global economic uncertainty and fluctuating stock markets, share prices are under pressure. As a result, they believe AECOM shares are undervalued, so this is a good opportunity to go in and buy back shares. The strategy should raise the value of the shares remaining in the market.

John M. Dionisio, the president and chief executive officer of AECOM, said in a press release: “The Board’s share repurchase authorization reflects its confidence in our long-term outlook and acknowledges this opportunity to create shareholder value by purchasing our shares at what we believe is a significant discount to their intrinsic value.”

Dionisio also said that AECOM will continue to expand through organic (internal) growth and through acquisitions.

To see the AECOM press release, click here.


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