MONTREAL, Oct. 22, 2013 /CNW Telbec/ — CN (TSX: CNR) (NYSE: CNI)
announced today that its Board of Directors has approved a new share
repurchase program, and a two-for-one stock split of the Company's
common shares outstanding. The Board has also approved a fourth-quarter
2013 cash dividend.
The new share repurchase program will be a normal-course-issuer bid to
purchase, for cancellation, up to 15 million common shares before
adjusting for the stock split, representing approximately 4.1 per cent
of the common shares issued and outstanding of the Company not held by
insiders on Oct. 15, 2013. On that date 417,992,780 CN common shares
were issued and outstanding.
CN repurchased 14.7 million common shares under its share repurchase
program announced in October 2012, at a weighted-average price of
C$95.35 per share, excluding brokerage fees, returning C$1.4 billion to
The new repurchase program - starting on Oct. 29, 2013, and ending no
later than Oct. 23, 2014 - will be conducted through a combination of
discretionary transactions and automatic repurchase plan through the
facilities of the Toronto and New York stock exchanges, or alternative
trading systems, if eligible, and will conform to their regulations.
Toronto Stock Exchange (TSX) rules will permit CN to purchase daily,
through TSX facilities, a maximum of 164,267 common shares under the
Company's new repurchase program. Purchases under the
normal-course-issuer bid will be made by means of open market
transactions or such other means as the TSX or a securities regulatory
authority may permit and under applicable law, including private
agreements under issuer bid exemption orders issued by a securities
regulatory authority in Canada.
The price to be paid by CN for any common shares will be the market
price at the time of acquisition, plus brokerage fees, and purchases
made under an issuer bid exemption order will be at a discount to the
prevailing market price as per the terms of the orders.
CN's management and Board of Directors believe that the repurchase by
the Company of its shares represents an appropriate use of its funds.
The two-for-one stock split will take the form of a stock dividend.
Shareholders will receive one additional common share of CN for each
common share held. The stock dividend will be payable on Nov. 29, 2013,
to shareholders of record at the close of business on Nov. 15, 2013.
The stock split will have no tax consequences in Canada or the United
States, and will not dilute shareholders' equity. All equity-based
benefit plans will be adjusted to reflect the issuance of additional
shares or options due to the declaration of the stock split. All share
and per share data for future periods will also reflect the stock split
when it becomes effective.
Luc Jobin, CN executive vice-president and chief financial officer,
said: "In addition to significant investments in the business and
increasing cash dividends over the years, CN has returned approximately
C$4.8 billion to shareholders through share repurchases since 2010.
This new share repurchase program and stock split attest to CN's
continued confidence in the growth of the Company and commitment to
create shareholder value while maintaining a strong balance sheet."
CN also announced today that its Board of Directors has approved a
fourth-quarter 2013 dividend on the Company's common shares
outstanding. A quarterly dividend of twenty-one and one-half cents
(C$0.215) per common share, post split, will be paid on Dec. 31, 2013,
to shareholders of record at the close of business on Dec. 10, 2013.
Certain information included in this news release constitutes
"forward-looking statements" within the meaning of the United States
Private Securities Litigation Reform Act of 1995 and under Canadian
securities laws, including potential purchases of common shares for
cancellation under a normal course issuer bid. CN cautions that, by
their nature, these forward-looking statements involve risk,
uncertainties and assumptions, and are subject to our board's
discretion in respect of the declaration of dividends. The Company
cautions that its assumptions may not materialize and that the current
economic conditions render such assumptions, although reasonable at the
time they were made, subject to greater uncertainty.
Important risk factors that could affect the above forward-looking
statements include, but are not limited to, the effects of general
economic and business conditions, industry competition, inflation,
currency and interest rate fluctuations, changes in fuel prices,
legislative and/or regulatory developments, compliance with
environmental laws and regulations, actions by regulators, various
events which could disrupt operations, including natural events such as
severe weather, droughts, floods and earthquakes, labor negotiations
and disruptions, environmental claims, uncertainties of investigations,
proceedings or other types of claims and litigation, risks and
liabilities arising from derailments, and other risks and assumptions
detailed from time to time in reports filed by CN with securities
regulators in Canada and the United States. Reference should be made
to "Management's Discussion and Analysis" in CN's annual and interim
reports, Annual Information Form and Form 40-F filed with Canadian and
U.S. securities regulators, available on CN's website, for a summary of
major risks and assumptions.
CN assumes no obligation to update or revise forward-looking statements
to reflect future events, changes in circumstances, or changes in
beliefs, unless required by applicable Canadian securities laws. In the
event CN does update any forward-looking statement, no inference should
be made that CN will make additional updates with respect to that
statement, related matters, or any other forward-looking statement.
CN (TSX: CNR) (NYSE: CNI) is a true backbone of the economy,
transporting approximately C$250 billion worth of goods annually for a
wide range of business sectors, ranging from resource products to
manufactured products to consumer goods, across a rail network spanning
Canada and mid-America, from the Atlantic and Pacific oceans to the
Gulf of Mexico. CN - Canadian National Railway Company, along with its
operating railway subsidiaries -- serves the ports of Vancouver, Prince
Rupert, B.C., Montreal, Halifax, New Orleans, and Mobile, Ala., and the
metropolitan areas of Toronto, Chicago, Detroit, Duluth,
Minn./Superior, Wis., Green Bay, Wis., Minneapolis/St. Paul, Memphis,
and Jackson, Miss., with connections to all points in North America.
For more information on CN, visit the company's website at www.cn.ca.
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