Scripps Networks Interactive, whose stock jumped early this month on speculation that it might be for sale, on Thursday said it was buying back $1 billion of its shares, including $300 million worth from its biggest stockholder, the Edward W. Scripps Trust.
The Trust will remain Scripps Networks Interactive's biggest shareholder with a 26% stake and said it has no further plans to reduce its holdings. On June 17, the Trust said it was petitioned a court in Ohio to see if was allowed to sell its controlling interest in Scripps Networks, The trust is bound to hold onto its control of the E.W. Scripps Co., from which Scripps Networks was spun off in 2007
"The decision to repurchase shares from the Scripps Trust and initiate a meaningful share repurchase program demonstrates our faith in the financial strength of our lifestyle media businesses and the company's ability to generate strong free cash flow," said Ken. Lowe, chairman, president and CEO of Scripps Networks Interactive. "It also reflects our commitment to create value for shareholders; provides us with ample resources to meet operating requirements; and gives us the financial flexibility we need to invest in the company's long-term growth."
Management of Scripps Networks had hired an investment back to help it study options for the company, which runs cable channels HGTV, Food Network and Travel Channel, according to the Wall Street Journal. The Trust hired a separate advisor to review its options, including selling its stake, according to the paper.