RMBS and INTEL
Intel extends stock buyback
New patent pact set with Rambus
By August Cole, CBS.MarketWatch.com
Last Update: 10:25 AM ET Sept. 17, 2001
SAN JOSE, Calif. (CBS.MW) -- Intel, the world's biggest semiconductor manufacturer, said Monday it clinched a new patent deal with chip memory specialist Rambus and announced plans to buy back as many as 300 million additional shares of common stock.
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Shares of Intel lost $1.50, or 6 percent, to $24.57 as one of the most heavily traded stocks in early trading. Rambus shares gained 18 cents, or 3 percent, to $6.35.
Intel will buy back 300 million more common shares, worth about $7.8 billion based on a Sept. 10 closing price of $26.07 a share.
The Securities Exchange Commission has made it easier for corporations to repurchase their own stock as a buffer against any market turmoil in the wake of last Tuesday's terrorist attack. During the second quarter, Intel said that it bought back 34 million shares for about $1 billion.
The 5-year technology licensing pact with Rambus (RMBS: news, chart, profile) replaces the companies' previous deal. It will involve fixed quarterly payments. More specific terms, however, remained undisclosed.
For Rambus, the announcement is expected to bolster its quarterly results, said CFO Bob Eulau.
"We will return to a very strong operating profit this quarter," he said. Analysts had expected, on average according to Thomson Financial/First Call, a profit of 1 cent a share.
"This broad agreement will help Intel continue to be a leader in providing high-performance chipsets," said CEO Craig Barrett in a statement.
San Jose, Calif.-based Intel (INTC: news, chart, profile), also declared its regular 2-cent quarterly dividend on Monday.
August Cole is spot news editor at CBS.MarketWatch.com in Chicago |
