US: Lear responds to investor concerns around valuation
Lear Corporation has responded to a letter from shareholders Marcato Capital Management and Oskie Capital Management outlining "concerns around the company's valuation."
The investors say the letter details their views on the company's valuation and describes the Group's ideas for "potential value-creating initiatives" and reiterates their interest in meeting with members of the board.
A statement from Lear noted: "We have a balanced strategy of investing in our business while maintaining a strong and flexible balance sheet and returning cash to shareholders. Consistent with this strategy, Lear is accelerating the execution of its US$1bn share repurchase programme - under which the company intends to repurchase nearly 20% of its outstanding shares - with US$600m of repurchases planned for 2013.
"The board of directors of Lear also accelerated the return of capital to shareholders through the recently announced 21% increase of the Company's quarterly cash dividend. This is in addition to more than US$500m of share repurchases completed over the last two years."
For its part the letter from Marcato and Oskie says: "We share the view expressed in the Company's press release of 7 February, 2013 that the Company is undervalued, and we see what we believe to be a serious discrepancy between Lear's improved operating performance and business prospects and its current market valuation."
Lear Corporation has posted second quarter net sales of US$4.1bn, up 12%, with core operating earnings of US$224m, an increase of 13%....
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