Uber initiates $1.5 billion accelerated share buyback; shares gain By Investing.com

SAN FRANCISCO – Uber Technologies, Inc. (NYSE: ) has entered into an accelerated share repurchase (ASR) agreement with Bank of America, NA to repurchase $1.5 billion of its common stock.

The move is part of a $7.0 billion share repurchase authorization that underscores the company’s intent to optimize shareholder value and confidence in its financial performance.

Shares rose 5% on the news.

Uber spokesman Prashant Mahendra-Rajah said the company is poised to significantly increase its free cash flow, which will support its strategy of increasing shareholder returns while maintaining growth investments. He also noted Uber’s view that its stock is currently undervalued related to the sustainability of its business activities.

The ASR agreement provides that Uber will transfer $1.5 billion to the dealer on January 6, 2025 and is expected to initially receive approximately 18.6 million shares, representing approximately 80% of the total expected shares to be repurchased the final number of shares will be determined by the volume-weighted average price of Uber’s shares, taking into account the discount and adjustments according to the ASR terms.

The ASR deal is expected to close in the first quarter of 2025. This share buyback plan reflects Uber’s proactive approach to capital management, aiming to retire more than one percent of its market capitalization.

This article is powered by AI and reviewed by an editor. See our T&C for more information.