The All Ordinaries Index (ASX: XAO) is having a very choppy day so far in Thursday's trading. At the time of writing, the All Ords is up, but only just, having clocked a 0.02% gain so far. That comes after the index spent most of the morning in red territory. But one All Ords share doesn't seem to have got the memo. That would be the Southern Cross Media Group Ltd (ASX: SXL) share price.
Southern Cross shares are currently up an impressive 8%, going for $1.76 at the time of writing. That comes after the media company closed at $1.62 a share yesterday and opened at $1.70 this morning.
So why are Southern Cross shares having such a strong day today? It could be the result of the announcement the company made this morning.
Before market open, Southern Cross released a market update to investors. This contained two new pieces of news. The first was an announcement that revealed the company has "received unsolicited approaches from several parties indicating potential interest in acquiring SCA's regional television assets".
Southern Cross stressed that these offers were non-binding and incomplete, and did not include "details of timing, price or conditions".
The company is assessing its options and engaging with these interested parties, and told investors that it will "continue to update shareholders as appropriate".
Southern Cross share price gains amid new share buyback announcement
The other piece of news that was revealed was a new on-market share buyback program worth up to $40 million. Here's some of what the company had to say on this matter:
With modest gearing and consistent free cash flow generation expected to continue, the Board has approved the buyback to enhance shareholder returns. SCA will fund the buyback from existing cash reserves and debt facilities, while continuing to invest in SCA's digital audio strategy to grow audiences and revenue opportunities.
It could be one or both of these announcements that are fuelling investor interest in Southern Cross today. Interest in buying a company's assets from multiple parties usually bodes well for a company and its market valuation.
Additionally, share buybacks have a direct benefit for existing shareholders. When a company purchases and retires its own shares on the open market, it reduces the company's total share count, boosting existing earnings per share (EPS). It also usually comes with share price gains, since the supply of the shares is being constricted.
So it's this announcement that is likely providing the boost to the Southern Cross shares that we are currently seeing.
At the current Southern Cross Media share price, this ASX All Ords share has a market capitalisation of $430.7 million, with a dividend yield of 5.11%.
