Microsoft Corp opened its wallet yesterday, and announced it will return $75 billion in “value” to shareholders over the next four years.
Following a series of legal settlements, the software giant feels it has disposed of the main reason for keeping a tight grip on its ready cash, which currently stands at about $56 billion. The company has come under increasing pressure to open up its coffers.
The Microsoft board has approved a plan that will see it double its annual dividend to $0.32 per share. It will also pay a one-off special dividend of $3 per share. At the same time, it will buy back $30 billion in stock over the next four years. Assuming the dividend level is maintained, this will amount to $75 billion over the next four years.
The firm said recent settlements, both with rivals and regulatory authorities, mean it has gone a long way in clarifying business and legal risks.
Microsoft insisted that it is confident in its ability to grow revenue, profits and shareholder value, essential if it is to maintain its dividend and buyout plans. At the same time, it said the increased return to shareholders would not mean a degradation in its research and development investment levels.