8-KOther Events

US BANCORP \DE\ 8-K Report (Jul 25, 2001)

Filed July 25, 2001For Securities:USBUSB-PHUSB-PPUSB-PRUSB-PQUSB-PSUSB-PA

Summary

U.S. Bancorp announced on July 24, 2001, that its board of directors has approved a plan to repurchase approximately 56.4 million shares of its outstanding common stock. This share repurchase program is intended to offset shares issued as part of the recently closed acquisition of NOVA Corporation. The company also indicated plans to issue convertible debt securities in the third quarter of 2001 to help finance the NOVA transaction. These actions signal a strategic move by U.S. Bancorp to manage its capital structure following a significant acquisition. The repurchase of shares suggests management's confidence in the company's value and its ability to generate sufficient cash flow. Investors should monitor the execution of both the share repurchase and the convertible debt issuance for their impact on earnings per share and the company's leverage.

Key Highlights

  • 1U.S. Bancorp's board approved a plan to repurchase 56.4 million shares of common stock.
  • 2The share repurchase is intended to replace shares issued for the acquisition of NOVA Corporation.
  • 3The acquisition of NOVA Corporation has officially closed.
  • 4U.S. Bancorp plans to issue convertible debt securities in Q3 2001 to finance the NOVA transaction.
  • 5Repurchases may occur in the open market or through privately negotiated transactions.
  • 6Reacquired shares will be held as treasury stock for future corporate uses.
  • 7U.S. Bancorp is a large financial services holding company with over $165 billion in assets.

Frequently Asked Questions

U.S. Bancorp is repurchasing shares to offset the shares that were issued as part of its previously announced acquisition of NOVA Corporation, which has now closed. This helps manage the dilution caused by the issuance of new shares for the acquisition.

The shares may be repurchased either in the open market or through privately negotiated transactions. The reacquired shares will be held as treasury shares and can be used for various corporate purposes in the future.

The company plans to issue convertible debt securities during the third quarter of 2001 as part of the financing for the NOVA Corporation transaction.

The acquisition of NOVA Corporation represents a significant strategic move for U.S. Bancorp, expanding its operations and likely its market share within the financial services industry. The company is managing the capital implications of this acquisition through share repurchases and debt issuance.