Royal Dutch Shell plc [NYSE: RDS-A] disclosed that it has started a $1.5 billion share repurchase program, being the first tranche of the $7 billion shareholder distributions from the sale of the company’s Permian business in the US. The form and timing for disseminating the remaining $5.5 billion together with any unpurchased amount of the $1.5 billion of shares under this tranche will be declared in early 2022.
The maximum number of ordinary shares which may be bought by the company under this agreement is 687,166,438, which is the maximum in accordance with the authority awarded by shareholders at the company’s 2021 AGM. It has subtracted the number of ordinary shares that were bought back by the company in accordance with the share buyback program declared on July 29, 20211.
Furthermore, the company confirmed that the shares repurchased under this agreement will be whichever of the ordinary shares A and/or B ordinary shares traded in the GBP denomination is reasonably the cheapest on a given trading day. Moreover, the firm has inked an irrevocable, non-discretionary agreement with a broker to allow the buying of ordinary shares and/or B ordinary shares for a period up to and including January 28, 2022.
In addition, the aggregate maximum return for the purchase of A ordinary shares and/or B ordinary shares is $1.5 billion. All shares bought back as part of this agreement will be canceled. The company disclosed that the distributions are in addition to its shareholder distributions in the range of 20-30% of cash flow from operations.