SpongeTech Delivery Systems, Inc. announced earlier today that its Board of Directors has authorized a 50 million share increase in its stock repurchase program to a maximum of 150 million common shares. As of February 28, 2009, the company has already repurchased 55,824,336 shares of common stock at an average price per share of $0.0308.
According to the press release, repurchased stock would be returned to SpongeTech’s treasury; thereby reducing the company’s overall market cap as well as the trading float. Both the Management and the Board of Directors feel strongly about the company and its growth prospects, and believe that the stronger share repurchase program is prudent in its development as well as enhancing shareholder value.
SpongeTech’s CEO, Michael Metter stated, “Based on our sell-through rates across our product lines and the success of out marketing campaign, we are anticipating strong growth within the Company this fiscal year. Even at current market price, we feel the stock is very much undervalued and we are committed to support and maintain the fundamental value of our Company’s stock.”
“Today’s action demonstrates the Management and Board of Directors strong confidence in the long term strength of the Company’s cash flow generation as we intend to continue reducing our share structure. We remain focused and committed to building SpongeTech into a globally recognized Company, therefore enhancing shareholder value,” commented SpongeTech’s COO, Steven Moskowitz.
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