StarHub CC3 has earmarked approximately $50 million to establish a share buyback programme to repurchase up to 3% of its issued share capital of approximately 51.9 million shares.
In a filing, the company says this is in line with its DARE+ objective to enhance its long-term total shareholder returns.
StarHub has already been buying back shares. Under the current mandate, the company has bought back 3.8 million shares as of June 23.
StarHub's single largest shareholder is a Temasek-led consortium, Asia Mobile Holdings, which holds 55.87% of the shares as at March 1. The second single largest shareholder is Japan's NTT Communications, with a stake of 9.92%.
In its annual report, the company says it has a free float of 33.92%.
To be funded by internal resources, the programme will facilitate the return of excess cash to shareholders, after taking into consideration the company’s short to mid-term capital requirements and cash flow trends; cost savings; revenue as well as margin growth to be delivered by its DARE+ transformation programme for and beyond its FY2023.
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StarHub expects to continue generating healthy cash flow despite having provided guidance that its FY2022 and FY2023 are expected to be heavy investment years for DARE+.
In the longer term, the company’s business model is shifting as a result of DARE+, which will see significant capital expenditure to operating expenditure substitution.
The purchased shares will be held as treasury shares to be used for the purposes set out in StarHub's 2023 EGM circular.
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The programme will be carried out in accordance with the share purchase mandate granted by shareholders at the 2023 EGM, which allows the purchase of up to a maximum of 10% of StarHub’s issued shares as at the date of the EGM for the duration of the mandate.
The programme may take over a year to be completed.
Shares in StarHub closed at an unchanged $1 on June 26.
