Oriflame proposes share buyback programme

The board of directors of Swedish direct seller Oriflame Cosmetics has called for an extraordinary general meeting (EGM) to issue a mandate for a share buyback programme, allowing for the purchase of up to 10% of the company’s shares until the 2014 AGM.

The purpose of the share buyback programme is to optimise the capital structure, which Oriflame says is enabled by its strong financial position and good cash flow generation from operations. The share buyback programme will be carried out in accordance with the EU Safe Harbour regulation and the acquired shares will be cancelled. Oriflame has also said it intends to execute the share purchases in such a way that its ability to pay out ordinary dividend is maintained.

The reason Oriflame has given for holding the EGM, which will take place on 19 December 2012, is that it believes it is optimal from a timing perspective to launch a share buyback programme in advance of the next AGM.