Summary
Corning Incorporated (GLW) announced a significant share repurchase agreement with Samsung Display Co., Ltd. (SDC) on April 5, 2021. Under this agreement, SDC will convert its 2,300 shares of Series A Convertible Preferred Stock into 115,000,000 shares of Corning's common stock. Corning will then immediately repurchase 35,000,000 of these common shares for approximately $1.52 billion, with payments structured over three years. This transaction represents a material event for Corning, impacting its capital structure and shareholder base. The repurchase is expected to close in April 2021. Additionally, the agreement allows for further repurchases of up to 22,000,000 shares in later years, at Corning's discretion. Alongside the repurchase, a related amendment to the shareholder agreement increases the beneficial ownership limit for SDC and its affiliates from 9% to 15% of Corning's common stock.
Key Highlights
- 1Corning entered into a Share Repurchase Agreement with Samsung Display Co., Ltd. (SDC) on April 5, 2021.
- 2SDC will convert preferred stock into 115,000,000 Corning common shares.
- 3Corning will repurchase 35,000,000 of these common shares for approximately $1.52 billion, payable over three years.
- 4The initial repurchase is expected to close in April 2021.
- 5Corning has the option to repurchase an additional 22,000,000 shares between 2024 and 2027.
- 6The shareholder agreement was amended to allow SDC to own up to 15% of Corning's common stock (fully diluted basis), an increase from 9%.
- 7The repurchased shares converted from preferred stock will be subject to a seven-year transfer restriction.