TORONTO – Rogers Communications will increase its current normal course issuer bid for its Class B non-voting shares to repurchase additional shares.
Between February 20, 2009 and February 19, 2010, the company may purchase up to 48 million Class B shares, which represents approximately 10% of the public float, for an aggregate purchase price of $1.5 billion. As at May 15, 2009 there were approximately 519.554 million Class B shares issued and outstanding.
Rogers also announced that it has set a target leverage range for its capital structure of net debt to adjusted operating profit of 2.0 to 2.5 times.
The announcement caused Moody’s Investors Service to upgrade Rogers’ senior unsecured debt rating to Baa2 from Baa3 “amid continued strong operating performance”.
While the target leverage range signals that the company is unlikely to continue on the de-leveraging trajectory that has been observed over the past several years, Moody’s vice president and senior credit officer Bill Wolfe, said that given Moody’s expectations that the company’s performance will remain strong, "Rogers has the ability to easily manage within its stated targets."
Moody’s also revised Rogers’ ratings outlook from ‘stable’ to ‘positive’.
"We expect the company to respect the leverage targets that it has disclosed to the market, and accordingly, we expect Rogers will take a measured approach in returning cash flow to shareholders," Wolfe continued.
