Warner Chilcott plc (WCRX) announced on Tuesday that it has ceased discussions regarding potential offers for the Company. The company said that its board has approved a recapitalization transaction, a new dividend policy for regular cash dividends and the renewal of the company's existing share redemption program.
The company said that under the recapitalization, it intends to incur $600 million of new debt that will be used, together with available cash, to fund a special dividend to Warner Chilcott's ordinary shareholders of $4.00 per share, or approximately $1.0 billion in the aggregate.
The company said it plans to declare the special cash dividend upon the successful amendment of the existing credit facilities. The company currently expects to declare and pay the special cash dividend before the end of the third quarter of 2012.
The company also announced a new dividend policy under which it expects to pay a total annual cash dividend to its ordinary shareholders of $0.50 per share in equal semi-annual installments of $0.25 per share. The first semi-annual dividend is expected to be paid, subject to declaration by the board of directors, in the fourth quarter of 2012.
The company also announced that its board has authorized the renewal of its share redemption program. Prior to the board's approval, the Company's existing redemption program allowed the company to redeem up to an aggregate of $250 million of its ordinary shares and terminated on the earlier to occur of December 31, 2012 or the redemption by the Company of an aggregate of $250 million of its ordinary shares. Approximately $88 million of the Company's ordinary shares had been redeemed under the program.
The renewal allows the company to redeem up to an aggregate of $250 million of its ordinary shares in addition to those already redeemed, and will terminate on the earlier to occur of December 31, 2013 or the redemption by the Company of an aggregate of $250 million of its ordinary shares, Warner Chilcott said.
The company repeated its previously disclosed full-year 2012 adjusted cash net income guidance of $3.55 to $3.65 per share. Analysts polled by Thomson Reuters expect the company to report earnings of $3.45 per share for fiscal 2012. Analysts' estimates typically exclude special items.
by RTT Staff Writer
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