Red Hat, Inc. (NYSE: RHT), the world's leading provider of open source solutions, today announced that its Board of Directors has authorized the repurchase of up to $500 million of the Company’s common stock from time to time on the open market or in privately negotiated transactions.
The new program replaces the previous $300 million repurchase program that is scheduled to expire on March 31, 2015. Approximately $220 million was used under the previous plan through March 25, 2015.
“Over the past four fiscal years, we have repurchased over $1 billion or approximately 19.5 million shares of Red Hat common stock,” stated Charlie Peters, Executive Vice President and Chief Financial Officer of Red Hat. “Given our strong conviction about our long-term growth prospects, a healthy balance sheet and the ability to generate operating cash flow, the Red Hat management team and Board of Directors believe that a new repurchase program will create further value for our shareholders.”
The timing and the amount of any repurchases of common stock will be determined by Red Hat management based on its evaluation of market conditions and other factors. Repurchases of common stock may also be made under a Rule 10b5-1 plan, which would permit common stock to be repurchased when the Company might otherwise be precluded from doing so under insider trading laws. The repurchase program may be suspended or discontinued at any time. Any repurchased common stock will be available for use in connection with the Company's stock plans and for other corporate purposes.
The repurchase program will be funded using the Company's operating cash flow. As of February 28, 2015, the Company had cash and investments of approximately $1.81 billion.
Red Hat had approximately 183.5 million shares of common stock outstanding as of February 28, 2015.