Canadian technology icon Research In Motion Limited (RIM), the maker of BlackBerry smartphones has announced a $1.2 billion share repurchase programme, in an effort to shore up the company's plunging share prices.
The buyback of approximately 21 million common shares represents about 3.6 per cent of the outstanding shares of RIM has been authorised buy its board of directors, the company said in a press release.
''The share repurchase program may commence on 9 November 2009 and will remain in place for up to 12 months or until the purchases are completed or the program is terminated by RIM. RIM has not repurchased any shares within the past twelve months,'' RIM said.
The repurchase will be carried out through the facilities of the Nasdaq stock market, under the US Securities Exchange Act of 1934. RIM will pay for the shares based on the prevailing market price at the time of purchase.
The board said that a share repurchase programme at this time is in the best interests of RIM and its shareholders, and will not impact RIM's ability to execute its growth plans given the strength of RIM's balance sheet and expected cash flow generation over the next several quarters.
Waterloo, Ontario-based RIM, founded in 1984 has been rapidly expanding especially in the past four years due to soaring revenues and profits, during which the workforce quadrupled. The company has been swiftly expanding its operations from North America to Europe and Asia.