WESTCHESTER, Ill.—Since ditching merger negotiations and a takeover bid a few weeks ago, Andrew Corp. has been busy buying back 2.4 million shares of its common stock at an average price of $9.10 per share.
“We believe the share repurchase program demonstrates our confidence in the long-term growth and margin expansion opportunities of the company,” said Ralph Faison, president and chief executive officer of Andrew. “We believe the strength and value of Andrew is not accurately reflected by the market and that share repurchases are an effective use of capital to build long-term shareholder value.”
The total number of shares repurchased represents about 1.5 percent of the company’s 159.7 million shares outstanding as of June 30, and the company pointed out that it has another 7.4 million shares available for repurchase under its buyback program.
In early August, Andrew rejected CommScope’s offer to buy the company and broke off its merger negotiations with ADC Telecommunications Inc., preferring instead to move forward as an independent company. Andrew had been in talks with ADC since May, but CommScope shook up the deal during the second week of August with an unsolicited takeover bid to steal Andrew away from ADC.
Andrew and ADC said they mutually agreed to terminate their merger agreement after negative Wall Street reactions to the merger “raised serious questions” about whether the deal could gain shareholder approval.
In a press release, Andrew called CommScope’s acquisition proposal “wholly inadequate” and not in the best interest of Andrew’s shareholders even though the offer represented a 36-percent premium above ADC’s $6.97 per share offer.
Andrew’s stock was trading down 15 cents per share early Thursday at $9.40 per share on the Nasdaq.
