Schwab plans $3.5 billion restructuring

SAN FRANCISCO, July 2 (UPI) -- U.S. discount broker Charles Schwab Corp. will return $1.2 billion to stockholders through a special $1 dividend as part of a $3.5 billion restructuring.

The move Monday came a day after Schwab completed its sale of wealth management subsidiary U.S. Trust Corp. to Bank of America for about $2.7 billion after taxes.

The San Francisco financial-services company also said Monday it would buy back 84 million shares, or $2.3 billion of its equity, in a modified Dutch auction tender offer and separate stock-purchase agreement with Chairman and Chief Executive Charles Schwab, the company's largest shareholder.

Under the offer, which is to begin Tuesday, the company will pay up to $22.50 a share for its own stock -- 10 percent more than last week's closing price -- through an auction guaranteeing stockholders who sell at least $19.50 a share.

The company's shares closed at $22 Monday on the Nasdaq Stock Market, up $1.48, or 7.21 percent.

Schwab had said it would consider buying back stock and paying a special dividend to put the proceeds of the $3.3 billion U.S. Trust sale to work.