Harley-Davidson (HOG) Approves 15M Common Buyback
On June 17, 2015, Harley-Davidson (NYSE: HOG) disclosed that its Board of Directors has authorized the Company to repurchase up to an additional 15.0 million shares of its common stock with no dollar limit (the “2015 Repurchase Authorization”).
The 2015 Repurchase Authorization is in addition to the share repurchases that the Board authorized in February 2014, pursuant to which the Company was authorized to repurchase up to 20.0 million shares of its common stock with no dollar limit (the “2014 Repurchase Authorization”). As of June 16, 2015, 15.9 million shares remained under the 2014 Repurchase Authorization. The Company also has an authorization (originally adopted in December 1997) by its Board to repurchase shares of common stock under which the cumulative number of shares repurchased, at the time of any repurchase, shall not exceed the sum of (1) the number of shares issued in connection with the exercise of stock options occurring on or after January 1, 2004 plus (2) one percent of the issued and outstanding common stock of the Company on January 1 of the current year, adjusted for any stock split (the “Options Repurchase Authorization” and, together with the 2014 Repurchase Authorization and the 2015 Repurchase Authorization, the “Share Repurchase Authorizations”). As of June 16, 2015, 5,609 shares remained under the Options Repurchase Authorization.
Under the Share Repurchase Authorizations, the Company may purchase its common stock through any one or more of a Rule 10b5-1 trading plan and discretionary purchases on the open market, block trades, accelerated share repurchases or privately negotiated transactions. The number of shares repurchased, if any, and the timing of repurchases will depend on a number of factors, including share price, trading volume and general market conditions, as well as on working capital requirements, general business conditions and other factors. The Company’s repurchase authority pursuant to the Share Repurchase Authorizations has no expiration date but may be suspended, modified or discontinued at any time.
The Company intends to incur long-term debt in the third quarter of 2015 in the amount of $750 million and to use the proceeds to repurchase common stock through the remainder of 2015. These repurchases will be in addition to already planned repurchases, which were expected to be in line with repurchases made in the second half of 2014. The Company expects the combined effects of the additional indebtedness and share repurchases to be accretive to earnings per share in 2015.