(By Balaseshan) Coca-Cola Co. (NYSE:KO) said its board of directors voted to recommend a two-for-one stock split to shareowners, which is the eleventh split in the stock's 92-year history and the first in 16 years.
The stock split recommendation reflects the board's continued confidence in the long-term growth and financial performance of the company. Implementation of the stock split is subject to approval by shareowners of an increase in the number of authorized shares of the company's common stock from 5.6 billion to 11.2 billion.
These matters will be voted on at a special shareowners meeting anticipated to be held on July 10, 2012. If approved, the record date for the split is expected to be on or about July 27, 2012.
Each shareowner of record on the close of business on the record date will receive one additional share of common stock for each share held. The new shares are expected to be distributed on or about August 10.
Chief Executive Muhtar Kent said the company's 2020 Vision to double its revenues over this decade provides a clear roadmap for creating value for its consumers, customers, bottling partners and shareowners. A stock split reflects the company's desire to share value with an ever-growing number of people and organizations around the world.
Earlier this year, the company also announced its 50th consecutive annual dividend increase, raising the quarterly dividend 8.5% to 51 cents per common share, which is equivalent to an annual dividend of $2.04 per share, up from $1.88 per share in 2011. The increase builds on the $8.6 billion the company returned to shareowners in 2011 through $4.3 billion in dividends and $4.3 billion in share repurchases.
Coca-Cola Co.'s common stock began trading in 1919. Since its original listing, the stock has split 10 times - first in 1927 and most recently in 1996.
With all dividends reinvested annually, one share of common stock purchased for $40 in 1919 would be worth about $9.8 million today. During the same time, Coca-Cola Co.'s market value has grown from about $20 million to more than $165 billion.
KO is trading up 0.96% at $74.83 on Wednesday. The stock has been trading between $63.34 and $74.88 for the past 52 weeks.