Following the completion of its first buyback programme of £30 million in January 2024, TP ICAP Group plc (LON:TCAP) announces that it will commence a second share buyback programme, starting today, of TP ICAP’s ordinary shares of 25p each for a maximum consideration of £30 million.

The program aims to reduce the capital of the company and/or meet obligations under employee share schemes.

TP ICAP is cash generative with a prudent capital management framework and the Board believes the Second Buyback strikes the appropriate balance between the continued and substantial investment in the company’s organic prospects such as Fusion, Liquidnet Credit, and Parameta Solutions, alongside reducing debt at a time when interest rates are high.

In line with the company’s clear dividend policy (a 50% pay-out ratio of adjusted post-tax earnings), the Board is recommending a final dividend of 10.0 pence per share, up 27%, which would bring the total 2023 dividend to 14.8 pence, an increase of 19%. The final dividend will be paid to eligible shareholders on 24 May 2024, with an ex-dividend and record date of 11 April 2024 and 12 April 2024, respectively.

In addition to the Buybacks, TP ICAP freed up £100 million of cash before the end of 2023, ahead of schedule. This cash is being used to reduce debt and other financing obligations, lowering future net finance costs, and increasing the investment grade headroom.

The Company will initially rely on the safe harbour conditions for trading set out in Article 3(2) and Article 3(3) of the Technical Standards. However, if the safe harbour conditions were to constrain the Company’s ability to purchase the Second Buyback within the targeted timeframe given, for example, share illiquidity, the Company may subsequently decide and announce its intention to trade outside of the safe harbour conditions.

The Company has entered into an agreement with Peel Hunt LLP under which it has issued instructions (that are irrevocable during any closed period) to Peel Hunt to manage the Second Buyback as “matched” principal. Peel Hunt will carry out the Company’s instructions through the acquisition of Ordinary Shares for subsequent repurchase by the Company. This arrangement is in accordance with Chapter 12 of the FCA’s Listing Rules and the Company’s general authority to repurchase Ordinary Shares. Peel Hunt will make its trading decisions independently of, and uninfluenced by, the Company during any closed periods of the Group.

Peel Hunt will undertake transactions in Ordinary Shares on any available trading venue or on an over-the-counter basis in order to execute the Second Buyback. Disclosure of such transactions will not be made by Peel Hunt as a result of or as part of the Second Buyback, but Peel Hunt will continue to make any disclosures it is otherwise legally required to make.