Construction and mining equipment maker Caterpillar Inc. (CAT) reported signing a definitive agreement with Citibank, N.A. to purchase common shares under an accelerated stock repurchase program.
As part of the accelerated stock repurchase deal, Caterpillar would buy back $1 billion of its stock from Citi, with an immediate delivery of about 11 million shares, based on current market prices. The final number of shares to be bought back and the aggregate cost to Caterpillar would be based on Caterpillar's volume-weighted average stock price during the term of the transaction, which may be complete in June of 2013.
In February 2007, the board authorized the repurchase of $7.5 billion of Caterpillar stock and in December 2011, the authorization was extended through December 2015. Through the end of 2008, $3.8 billion of the $7.5 billion authorization was spent and no shares of stock have been repurchased since then.
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