CGI to buy back 4.2 million shares from Caisse de depot et placement du Quebec​

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MONTREAL - CGI Inc. has signed a deal to buy back and cancel 4.2 million of its class-A subordinate voting shares from the Caisse de depot et placement du Quebec for $400 million.

The technology consulting company says it will pay $95.13 per share, a slight discount to where the shares closed on the Toronto Stock Exchange on Thursday at $98.07.

CGI says the transaction will be made in connection with a periodic portfolio rebalancing by CDPQ.

The Quebec pension fund manager will continue to hold 27.2 million class-A shares, representing a 10.9 per cent stake in the company.

The share repurchase will be made under CGI's normal course issuer bid.

By buying back its shares, a company reduces its equity base, spreading profits over fewer shares. That increases its earnings per share, a key ratio used to determine a company's financial health.