Apple Unveils Dividend and $10 Billion Stock Repurchase

Company loosens the purse strings and will spend roughly $45 billion over three years.

Apple loosened the purse strings on Monday, announcing a quarterly dividend of $2.65 per share and a $10 billion stock buyback program. 

The Cupertino, California-based company estimates it will spend roughly $45 billion over the next three years. 

Wall Street responded enthusiastically to the news of Apple's spending plans. Shares of the stock opened at $597.19, up 1.98 percent.

Also read: Apple in China & the Mike Daisey Problem: Bad ‘Journalism’ Clouds Jobs Issue

The news also followed some unexpected public relations relief for the company over the weekend, as  "This American Life" revealed that there were some fabrications in a report about worker abuses at Chinese facilites where Apple products are made.

The company has been sitting on a roughly $100 billion pile of cash, with analysts speculating incessantly about how Apple and its newly minted CEO Tim Cook would spend the money.

Also read: 'This American Life' Retracts Report on Working Conditions at Apple Supplier

“Innovation is the most important objective at Apple and we will not lose sight of that,” Cook said on a conference call with analysts.

Cook said the dividend would broaden the company’s investor base by attracting new investors. The repurchase program is being undertaken to prevent the share price from being diluted by future employee equity grants and the company's stock purchase programs for employees. 

Cook said that the company has a big enough war chest to continue to invest in new products and business operations.

Indeed, demand for iPads and iPods should keep the company liquid even as it moves to share more of the loot with investors. Apple is projected to generate approximately $75 billion in cash this year, according to analysts.

Also read: Tim Cook Hits Back at Factory Abuse Reports: 'Apple Cares About Its Workers'

The dividend will take place in the fourth quarter of its fiscal 2012, while the share repurchase program will begin on September 30, 2012.

The stock buyback is expected to take place over three years.