Gannett spent $1.8 billion repurchasing 28.4 million shares from 2005 through the third quarter of 2008 -- a period when it felt the stock was undervalued, U.S. Securities and Exchange Commission documents show. The company's average per-share cost -- $64 -- has proved a dismal investment, however: Shares just closed at $3.66.
Many of the purchases came after Craig Dubow became CEO in July 2005. All occurred after Gracia Martore (left) became chief financial officer, in 2003. (Gannett details the 2005-07 purchases on page 31 of its annual Form 10-K, filed with the SEC on Feb. 28, 2008.)I don't know how much these repurchases contributed to Gannett's current debt load -- the same debt the board of directors is likely to move against more aggressively, with money saved from a dividend reduction as soon as tomorrow.
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The 28.2 million shares valued at $3.72 per share calculates to a loss of $1,698,496,000.
ReplyDeleteThis assumes that they haven't repurchased more than the 28.2 million shares.
Gannett spent 1.8 billion on stock that is now worth 104.9 million? Great investment indeed.
Outrageous. Can't believe this went on as recently as 2008.
ReplyDeleteand I thought I was a financial moron! It is amazing that even folks with such mighty titles don't always make the right decisions.
ReplyDelete...what's amazing is the number of people who were walked out the door through no fault of their own while the likes of Dubow are still around to continue driving this company deeper into the ground.
ReplyDeleteI have no frame of reference for this. Is this---the large amount of stock purchases---typical behavior at other corporations?
ReplyDeleteHow Dubow and Gracia can remain employed is a mystery. I'm a Detroit Lions fan (yes, go ahead, laugh) and this reminds me of the Matt Millen era -- year after year of mismanagement, incompetence, careening from one new plan to another, all in an accountability-free zone.
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