A "stabilized business" has paved the way for an accelerated stock buy-back program at Atlanta-based The Home Depot.
The home improvement giant announced the pricing of a $2 billion senior note issuance to refinance $1 billion of senior notes that came due in March 2011 and to repurchase $1 billion of outstanding shares through an accelerated share repurchase program with Barclays Capital.
The accelerated share repurchase is in addition to the company's previously announced intention to repurchase approximately $2.5 billion of outstanding shares throughout 2011 using excess cash generated by the business.
"Creating strong shareholder value is a priority, and we are committed to returning capital to our shareholders in the form of dividends and share repurchases," said Frank Blake, chairman and CEO, in a prepared statement. "2010 was the first year of positive sales growth since 2006, and our business continues to stabilize. As such, we elected to take advantage of the attractive interest rate environment and raise incremental debt capital to be used for share repurchases."
In February 2011, the company announced a 6% increase in its quarterly cash dividend to 25 cents per share. As of the end of fiscal 2010, the company had $9.9 billion remaining in its share repurchase authorization.