IG broker announced a plan for a voluntary repurchase of its shares worth up to $150 million that will be divided between two phases.
IG Group announced the start of a major share buyback program of $150 million. The online trading platform has signed a non-discretionary instruction with J.P. Morgan Securities to repurchase the first phase of the buyback. Under the agreement, IG will buy back its shares worth up to $75 million on behalf of the trading company.
Transactions under the first tranche commence on Thursday with a settlement deadline before January 21, 2023, which is referred to as the engagement period. Another phase of buying back the remaining $75 million of shares will be implemented later in 2023. IG expects to complete its entire buyback program by the end of FY2023.
"Our new Capital Allocation Framework crystallizes our capital priorities to maintain a strong balance sheet, invest purposefully in our business, and meet the needs of key stakeholders. We are thrilled to announce our new shareholder distribution policy including a share buyback program of up to £150 million," said June Felix, the CEO of IG Group.
Buybacks in Other Brokers
IG is not the only publicly traded company to launch a buyback program. Plus500 and CMC Markets, two brokers from London, have bought back their shares. After the start of IG's share buyback program, the company's stock price experienced a sudden spike. However, it soon corrected and traded almost 3% higher.