TSCO - Chewy Plans Share Repurchase Worth $500M From BC Partners | Benzinga
Chewy, Inc. (NYSE: CHWY) has made a strategic move to repurchase $500 million worth of its Class A common stock from Buddy Chester Sub LLC, an entity associated with BC Partners Advisors LP (BC Partners). This transaction, priced at $28.49 per share, is expected to retire 17,550,000 shares upon completion.
Priced at a 5% discount to the Jun 26, 2024 closing price, this buyback underscores Chewy's confidence in its profitability and cash flow generation. Chewy considers this repurchase as an accretive use of capital, effectively reducing the ownership stake of its largest shareholder.
This repurchase follows Chewy's recent announcement of a $500 million share repurchase program, highlighting the company's confidence in its compelling growth trajectory and margin expansion strategy. By leveraging its strong financial position, Chewy continues to explore avenues to efficiently return cash to shareholders while bolstering its market position in the pet care industry.
In the first quarter of fiscal 2024, Chewy generated a free cash flow of $52.6 million, supported by $81.9 million in net cash provided by operating activities. Ending the quarter with more than $1.1 billion in cash, cash equivalents and marketable securities, Chewy maintains a debt-free status, bolstering its financial flexibility to execute shareholder-friendly initiatives like the share buyback.
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