Shares of Premiere Global Services Inc., which provides business communication services, hit a 52-week high Friday after the company reported strong first-quarter earnings and agreed to a $150 million stock buyback to settle shareholder concerns.
Under the terms of the agreement with investment firm Crescendo Partners II LP, Premiere Global will begin by April 25 to acquire up to nearly 11.9 million shares of its stock, or about 17 percent of its outstanding shares, at a fixed price of $12.65 each. The offer price represents a premium of about 10 percent above the average closing price over the last 10 trading days, according to Premiere Global.
The company also agreed to recommend that shareholders approve a proposal to declassify its board at the annual meeting. If approved, each of the directors will be elected for a one-year term and stand for re-election annually beginning in 2008.
As part of the settlement, Crescendo Partners withdrew its proxy contest and certain activities related to Premiere Global's annual meeting and agreed to vote its shares in favor of the board's nominees and proposals.
Wall Street analysts welcomed the news. CIBC World Markets Corp.'s Timothy Horan increased his year-end profit estimate on Premiere Global to 89 cents per share from 68 cents, while Morgan Keegan & Co. Inc. analyst Tavis C. McCourt raised his estimate to 77 cents per share and said that may be conservative "given the current operating momentum."
Analysts polled by Thomson Financial, on average, expect a 2007 profit of 72 cents per share.
Shares of Premiere Global added 85 cents, or 7.6 percent, to $12.10 after earlier hitting a 52-week high of $12.45 on the New York Stock Exchange. The company's stock had traded between $6.83 and $11.84 in the past year.
Subscribe to:
Post Comments (Atom)
No comments:
Post a Comment