Schindler Holding AG (SCHP) rose the most in more than two years after the Swiss elevator-maker outlined plans to buy back $1.2 billion of stock at higher than recent market pricing.
Schindler jumped as much as 5 percent, the biggest intraday increase since late September 2011, and was trading up 4.9 percent at 128.10 Swiss francs as of 12:25 p.m. in Zurich. Volume exceeded the three-month daily average by 34 percent.
The company will repurchase as much as 5.8 percent of registered shares at 129 francs apiece and up to 8.9 percent of participation certificates at 129.80 francs each in the first two weeks of November, Ebikon-based Schindler said today in a statement. Until now, the manufacturer was acquiring shares at stock-exchange prices under a program that began Jan. 3 and runs through 2015.
“We have always been told that we should buy back more actively,” and “this is an opportunity to do so,” Barbara Zaech, Schindler’s investor relations head, said by phone. The transaction was triggered by a family shareholder who offered to sell a block of 2.37 million shares, she said. The Schindler and Bonnard families and related parties hold 70 percent of the manufacturer’s voting rights.
“Although it is part of the current buyback program, Schindler never bought the full amount back,” Andy Schnyder, a Zurich-based analyst at Bank Vontobel AG, wrote in a note to investors. “Management, in a very uncommon way, is listening to its shareholders and this is something that has been not always the case.”
The gain today narrowed the decline in Schindler’s stock price this year to 3 percent, valuing the manufacturer at 15 billion francs ($16.6 billion). The slump is counter to a 22 percent gain on the Swiss Performance Index. (SPI) Schindler’s price has fallen in 2013 after two successive quarters of profit-target cuts, including an announcement on Oct. 15 that it won’t meet this year’s goal because of spending on expansion in growth markets, delays in reducing business costs and product-pricing pressure.
“Schindler now wants to do something good for its shareholders,” Vontobel analyst Schnyder said.
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