BlackBerry Ltd (NASDAQ:BBRY) (TSE:BB) obtained an approval from the Toronto Stock Exchange to amend its existing normal course issuer bid (NCIB) and increase its existing stock buyback program.
According to the Canadian technology company, the approval allowed the company to repurchase 27 million common shares or 5.8% of the public float, up from 12 million common shares of 2.5% of the public float.
The existing stock buyback program of BlackBerry will be effective until June 28, 2016. The company could repurchase its shares on the Toronto Stock Exchange and NASDAQ. It did not change any other terms of the NCIB.
BlackBerry automatic purchase plan
BlackBerry entered into an automatic purchase plans with its designated broker to buy as much as 2,685,524 shares in connection with the NCIB.
The Canadian technology company makes purchases under the NCIB through open market transactions or other means as permitted by the NASDAQ or a security regulator. BlackBerry makes purchases through pre-arranged crosses, exempt offers and private agreements under an issues bid exemption order issued by a securities regulatory authority.
The company is permitted to make daily purchases through the facilities of the Toronto Stock Exchange. Under the rules of the stock exchange, its maximum daily purchase is 578,619 shares, which account 25% of the average daily trading volume.
Additionally, it is allowed to make a once a week, block purchase of common shares not directly or indirectly owned by insiders under the rules of the Toronto Stock Exchange.
Under the rules of the stock exchange, all of the shares purchases pursuant to the NCIB are cancelled. BlackBerry purchased and cancelled a total of 9,921,454 shares between June 29, 2015 and January 29, 2016.
Attractive investment
The Board of Directors of BlackBerry believes that purchasing its common shares represents an attractive investment given the current conditions of the equity market. The company said the amended NCIB will not have a significant impact on its cash balance.
The stock price of BlackBerry gained more than 2% to CAD$9.91 per share on the Toronto Stock Exchange around 1:12 PM (EST).
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