Disney Buys Back 50 Million Shares

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The Walt Disney Co. on Thursday said it has repurchased 50 million of its common shares, via investment bank Goldman Sachs, from ``significant stockholders'' at a discount to the current market price.

Disney shares were off 11 percent, or $2, at $16.50 by midday on the New York Stock Exchange, hitting as low as $15.50, its lowest level since January 1995.

Burbank, Calif.-based Disney, owner of theme parks, a movie studio and the ABC and ESPN television networks, said Goldman Sachs bought 85 million of the company's common shares from similar stockholders at the same purchase price.

Goldman Sachs intends to resell its Disney shares into the market, said Disney, which had about 2.1 billion shares outstanding on June 30.

Disney's stock repurchase is part of a 386 million share buyback authorization.

Chief Financial Officer Thomas Staggs said on Monday the company started repurchasing shares and would use a portion of proceeds from its $1 billion bond offering to fund some of those purchases.

Media companies stocks have been under particularly acute pressure since the market resumed trading on Monday following last week's attacks on the World Trade Center in New York and the Pentagon near Washington, D.C.

Many companies tend to roll back their advertising following a crisis, raising the possibility of earnings shortfalls for the major media companies. Viacom Inc., which owns the CBS television network plus a stable of cable channels, and USA Networks Inc. have already warned their results could fall short.

Viacom and Disney each also own a number of television stations, which went to commercial-free news coverage for much of last week. That lost ad revenue, an increase in costs for coverage is expected to take a toll on those companies' results.

Disney spokesman John Dreyer declined to comment on the financial impact of last week's attacks. ``We believe the market and Disney will stabilize,'' he said. ``We continue to have faith in the resiliency of the market and in the long term outlook for our company and its underlying assets.''

Disney, which operates Walt Disney World in Florida and Disneyland in California, is also vulnerable to the possibility of fewer vacation bookings to its theme parks.