NU Online News Service, Aug. 19, 9:43 a.m. EDT
Marsh & McLennan Companies, Inc. says it has increased its stock buy-back program to $1 billion with the addition of $500 million in repurchase authority.
The company made the announcement late yesterday after New York markets closed.
Yesterday's authorization by the firm's board, combined with the $500 million share repurchase program announced on Sept. 30, 2010, brings the total buy-back authorization to $1 billion.
Marsh & McLennan says it already repurchased $312 million—11.2 million shares of common stock—as of June 30, and it plans to continue repurchasing stock in the current quarter.
A company purchases its own stock with retained profits when it is thought they cannot be reinvested to produce good returns.
“Our earnings power has continued to strengthen over the past several years, allowing us to invest in our businesses and return capital to shareholders. This share repurchase program, combined with the two increases in our quarterly dividend over the last year totaling 10 percent, illustrates our commitment to enhancing shareholder value,” Brian Duperreault, president and chief executive officer of Marsh & McLennan says in a statement.
Shares of Marsh & McLennan closed yesterday virtually unchanged from where they started at $28.43.
Marsh & McLennan is the parent company of insurance broker Marsh and reinsurance broker Guy Carpenter.
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