Ahold to buy back two billion euro in shares

Ahold to buy back two billion euro in shares

Dutch retail group Ahold has announced it would purchase its own shares for some two billion euro. The distributor is sitting on a pile of money, after selling Scandinavian group ICA.

Extra purchase thanks to Scandinavian divestment

Earlier this year Ahold sold 60% of its participation in Scandinavian sector colleague ICA to co-owner Hakon Invest for 2.5 billion euro. The sales had been taken into account: in 2012 Ahold had already decided to leave ICA when it could not get complete control of the chain.

 

A number of analysts already expected Ahold to use that money to buy its own shares. A drop of the number of shares in circulation causes future profits to be divided among less titles, causing the other shares to rise in value. At the same time however chances for a major takeover diminish significantly. Some analysts believed Ahold was planning on taking over American retailer Harris Teeter, but that has become unlikely now.

 

Most analysts expected Ahold to reserve 1 to 1.8 billion euro for the purchase. In February of this year Ahold already announced a buyback of its own shares for about 500 million euro spread across about 12 months. In the end the number is even higher: before the end of 2014 Ahold will buy back two billion euro of its own shares. This would mean that the company would be buying about a sixth of its own value.

Questions or comments? Please feel free to contact the editors


Hema is back on the right track

27/06/2017

Dutch store chain Hema has finally managed to turn the tide according to the first quarter results it recently published: turnover grew and the net loss dropped.

Russian owner for Holland & Barrett

26/06/2017

Only a few days ago, Kruidvat’s parent company, AS Watson expressed an interest in Holland & Barrett, but its owner (Carlyle) sold it to a Russian billionaire.

Action opens new German distribution center

26/06/2017

Dutch store chain Action has opened its first German distribution center near Mannheim, which will handle the entire supply chain for Germany, Austria and part of France.

Retailers call for Commission to ask right questions on trading practices

23/06/2017

(content provided by EuroCommerce) EuroCommerce Director-General Christian Verschueren has commented on calls for legislation on trading practices in agriculture and the Commission decision to take the first steps towards proposing EU measures.

Gaming industry continues to grow

22/06/2017

A study from research firm Newzoo shows that the gaming industry will once again make strides in 2017. The industry’s total turnover should reach 108.9 billion dollars (nearly 100 billion euro) for the full year.

Technology as a 'margin pressure reliever'

19/06/2017

Technology is able to improve productivity of retailers in various sections within their operations, according to McKinsey. The options are numerous: shelf-stacking robots, back office/workflow process automation, delivery via drones and so on.

Back to top