CGI Inc. says it will repurchase nearly four million of its shares from the Caisse de dépôt et placement du Québec for about $400 million.
The Montreal-based IT and business consulting services firm says it has entered into a private agreement with the Quebec pension fund manager to pay $100.80 per Class A share, slightly below the Monday closing price of $103.92.
The Caisse would remain CGI's largest shareholder with about 23.5 million shares, representing about 9.8 per cent of outstanding shares.
Kim Thomassin, executive vice-president and Head of Québec at the Caisse, says the sale of CGI shares allows it to "monetize a portion of our investment to the benefit of our depositors" and allows it to reinvest in other Québec companies.
The share repurchase is part of CGI's normal course issuer bid to buy back up to 18.8 million of its shares by Feb. 5, 2023.
CGI co-char Julie Godin says the transaction, which is expected to settle on Wednesday, is good for its shareholders.
"With a solid balance sheet and excellent cash generation combined with $2.7 billion of cash readily available at the end of December 2021, CGI has the strength and capital resources to execute on our Build and Buy profitable growth strategy," she said in a news release.
This report by The Canadian Press was first published March 1, 2022.
