Campbell Soup to buy back company stock
LOS ANGELES (Reuters) - Campbell Soup Co (CPB.N) said on Tuesday its board had authorized it to use $600 million of net proceeds from its now-completed sale of its Godiva Chocolatier business to buy back company stock.
The divestiture, whose completion was announced on Tuesday, is expected to add to earnings in fiscal 2008, the company said. It added it intends to make additional investments in advertising and cost reduction initiatives.
Campbell, the largest U.S. soup maker, reiterated a fiscal 2008 earnings outlook it gave last month of adjusted earnings per share growth of 5 percent to 7 percent from an adjusted 2007 base of $1.95 per share.
Sales growth from continuing operations is expected to be in excess of its long-term target range of 3 percent to 4 percent, due in part to the favorable impact of currency.
Campbell sold the Godiva business, which has annual sales of approximately $500 million, to Yildiz Holdings A.S. for $850 million. The agreement was first announced in December.
Shares of Campbell closed up 70 cents, or about 2 percent, to $32.30 on the New York Stock Exchange.
(Reporting by Alexandria Sage; editing by Carol Bishopric, Leslie Gevirtz)
