Canadian Pacific Kansas City (CPKC) has received approval from the Toronto Stock Exchange (TSX) for a new share repurchase program, known as a normal course issuer bid (NCIB). The program allows CPKC to purchase up to 37,348,539 common shares, approximately four percent of the company's total shares outstanding as of February 18, 2025.
CPKC had 933,713,487 common shares issued and outstanding as of February 18, 2025.
The NCIB is set to commence on March 3, 2025, and will continue until March 2, 2026.
The company plans to repurchase its shares through the facilities of the TSX, the New York Stock Exchange (NYSE), and alternative trading systems by means of open market transactions or other permitted methods. The price CPKC will pay for any common shares will be the market price at the time of purchase or such other price as may be permitted by the rules of the TSX.
In connection with the NCIB, CPKC expects to enter into an automatic purchase plan agreement with its designated broker to allow for purchases of its common shares during internal quarterly blackout periods.
CPKC's president and CEO, Keith Creel, stated that the decision to reinstitute the share buyback program comes after the company's successful efforts to strengthen its balance sheet and reduce leverage following the combination of Canadian Pacific and Kansas City Southern into CPKC. The company aims to return cash to shareholders in a disciplined, opportunistic manner.
The actual number of common shares that will be repurchased under the NCIB, and the timing of any such purchases, will be determined by CPKC, subject to the limits imposed by the TSX, the NYSE, and applicable securities laws in Canada and the United States.
CPKC believes that the purchase of its shares from time to time is an appropriate and advantageous use of its funds. The market has reacted to these announcements by moving the company's shares -1.6% to a price of $76.45. For the full picture, make sure to review Canadian Pacific Kansas City's 8-K report.
