KLIC does it right:
This is an example, of what companies should be doing:
Kulicke & Soffa Industries, Inc. (NASDAQ: KLIC) ("K&S") announced that it has commenced a tender offer today to repurchase for cash (the "Offer") up to all of its $62,000,000 aggregate principal amount of its outstanding 1.0% Convertible Subordinated Notes Due 2010 ...The Company is offering to purchase the Notes at a price of $720 for each $1,000 of principal amount of Notes tendered... nasdaq.com
After their recent acquisition of the wedge-bonder Orthodyne, and exiting the wire-bonding business, KLIC realized net $72M in cash (added to their previous $186M). So they are retiring debt early. The exercise price on this convertible debt is $12.84/share, and the stock is now so far below that, the debt-holders will probably sell at much less than face value.
Then, KLIC needs to buy back shares during this downturn, to avoid dilution from the 6.92 million employee and director stock options outstanding. With the stock at $1.55, this would cost only $11m.
Do that, and a few other things, and I might consider KLIC an investment, instead of a trading vehicle. |
