board authorized the repurchase of up to $4 billion of its common outstanding shares over the next 36 months -- the first buyback in the company's history.
The company said late Wednesday that based on its current stock price, the buyback would represent about 10% of the company's total market capitalization. As of April 2, Motorola had about 2.45 billion shares of common stock outstanding.
Motorola shares closed Wednesday up 2.9% to $16.90.
"Motorola is committed to investing for growth and creating value for our stockholders," said Ed Zander, chairman and CEO. "We are pleased to initiate the first stock repurchase program in Motorola's history. Motorola's financial performance over the past five quarters has proven that we have transformed our business model into one with the capability to consistently generate free cash flow.
"We believe this stock repurchase program creates value for stockholders and further underscores our confidence in Motorola's long-term growth," Zander added. "Our strong balance sheet and significant free cash flow allow us the flexibility to simultaneously invest in our current business, pay dividends, further reduce debt, initiate a share repurchase program and take advantage of strategic opportunities."
As of April 2, Motorola had cash, cash equivalents and short-term investments of roughly $11.3 billion and had a net cash position of $6 billion, according to the company.