May 5, 2023

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ArcelorMittal, the world's leading steel and mining company, has recently made a significant announcement following the publication of its first-quarter 2023 results. ArcelorMittal is set to commence a new buyback program of up to 85 million shares, demonstrating its commitment to enhancing shareholder value and capital efficiency.

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Reducing ArcelorMittal's Share Capital

One of the primary objectives of ArcelorMittal's newly announced buyback program is to reduce its share capital. By repurchasing a significant number of shares, ArcelorMittal aims to optimize its capital structure and enhance the value of remaining shares for existing shareholders. This strategic move showcases ArcelorMittal's confidence in its future prospects and its commitment to generating long-term value.

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Meeting Employee Share Program Obligations

In addition to reducing share capital, ArcelorMittal intends to utilize the acquired shares to meet its obligations arising from employee share programs. These programs play a crucial role in aligning the interests of employees with those of the company and incentivizing them to contribute to ArcelorMittal's growth and success. By fulfilling its obligations through the buyback program, ArcelorMittal ensures that its employees can benefit from the ownership of ArcelorMittal shares.

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Fulfilling Obligations Exchangeable into Equity Securities

Apart from employee share programs, ArcelorMittal's buyback program will also address its obligations exchangeable into equity securities. This includes obligations tied to convertible bonds or other financial instruments that can be exchanged for shares of ArcelorMittal. By repurchasing shares, ArcelorMittal aims to honor these obligations efficiently and strengthen its financial position.

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Factors Influencing the Buyback Program

The actual number of shares repurchased under the program will depend on several factors. Firstly, it will be influenced by the level of post-dividend Free Cash Flow (FCF) generated over the specified period. ArcelorMittal's defined policy dictates that a minimum of 50% of the post-dividend annual FCF should be returned to shareholders. Therefore, the availability of sufficient FCF will play a role in determining the extent of the buyback.

Additionally, ArcelorMittal's buyback program is subject to continued authorization by shareholders and market conditions. ArcelorMittal remains committed to acting in the best interests of its shareholders and will adapt the program based on prevailing market dynamics.

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Members of LevelFields received the alert of this event on May 5, 6:20 AM ET

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