7/23/2008 10:18:00 AM
Vodafone to buy back £1bn of shares with immediate effect
Vodafone has announced a surprise move to buy back £1bn of its shares after the company’s plunged in the wake of a disappointing revenues forecast.
Vodafone’s shares dropped by almost 14% wiping more than £10bn off the value of the company after the bosses said that year earnings would be at the lower end of target scale between £39.8bn and £40.7bn.
A statement issued today said: ‘The Board of Vodafone Group Plc has considered the market reaction to the Group's Interim Management Statement, issued on 22 July 2008, and has decided to introduce a £1 billion share repurchase programme with immediate effect.
‘This action reflects the Board's belief that the share price significantly undervalues Vodafone.’
Vodafone shares closed at 129p on Tuesday, making it the biggest percentage faller in the FTSE 100 and valuing the business at about £80bn.