Articles
advertisement
Resources
Issue Archive
Event Calendar
Green Industry and Equipment Expo
Power-Gen International
Dec. 2-4
Orlando, FL
www.power-gen.com
World of Concrete
Feb. 3-6, 2009
Las Vegas Convention Center
Las Vegas, NV
www.worldofconcrete.com
The Rental Show
March 2-5, 2009
Georgia World Congress Center
Atlanta, GA
www.therentalshow.com
United Rentals to Buy Back Up to 27 Million Shares
The board of United Rentals has approved a “modified Dutch auction” tender offer to purchase up to 27.16 million shares of its common stock at between $22 and $25 per share, the company said last week. The number of shares is about 31.4 percent of the total number of shares of common stock currently outstanding. The total purchase price of the stock could be $679 million if all the shares are purchased at maximum price.
Shares of United Rentals jumped 15 percent to $22.50 in pre-market trading Tuesday on volume of 52,200 shares. At the close of trading Friday, United Rentals stock was trading at $21.80, more than $2 higher than before the buyback was announced.
United intends to commence the offer this week and keep the offer open for at least 20 business days. The company also said it repurchased all of its outstanding Series C preferred stock and Series D preferred stock, a majority of which was held by Apollo Investment Fund IV and Apollo Overseas Partners.
“We believe that these share repurchases represent an opportunity to achieve significantly more EPS accretion, and to capture it more quickly, than through any other means,” said interim CEO Michael Kneeland. “Moreover, we believe that the tender offer will benefit stockholders by providing an efficient mechanism for those who desire it to obtain liquidity at a premium over recent trading prices and, for our remaining stockholders, an enhanced ability to participate in the long-term earnings potential of our business.”
In anticipation of the share repurchases, United entered into a new $1.25 billion asset-based loan facility and repaid the $464 million outstanding under the company’s former revolving credit facility and term loan. The new debt issuances, combined with the existing debt of the company, are expected to result in total pro forma leverage ratios that the company views as reasonable, the company said. The company also said the share repurchases will be accretive to currently projected earnings per share, excluding a one-time charge of about $235 million recorded as a reduction of income available to common stockholders as a result of the purchase of the preferred stock.
Based in Greenwich, Conn., United Rentals is No. 1 on the RER 100.
blog comments powered by Disqus
Want to use this article? Click here for options!
© 2008 Penton Media Inc.
most recent story
popular articles
advertisement
Popular Articles
- United Rentals 3Q Revenue Drops 12 Percent
- Industrial Base Helps H&E Equipment Services Hold Steady in Q3
- HERC Announces Rental Rate Hikes
- Telematics: A 2008 Rental Odyssey
- Taking the long view
Stock Block
Buyers Guide
Buyers Guide
The RER Industry Directory is the resource buyers like yourself rely on when looking for up-to-date information on the products or services you are searching for.
Learn More
Rental Rate Guide
Rental Rate Guide 2008
Want to know how much equipment is renting for these days? Find out in RER’s original 2008 Rental Equipment Rate Guide.
Learn More



