Pinterest shares surge on $1bn Elliott injection, share buyback plan

(Sharecast News) - Activist investor Elliott Investment Management has injected $1.0bn into Pinterest, which the image pinboard platform operator said it would use to buy back shares.

Elliott, which first invested in Pinterest in 2022, said it has "strong conviction in the company's trajectory", according to partner Marc Steinberg, who is also a Pinterest board member.

"We are excited to meaningfully increase our investment in the company and deepen our partnership with Pinterest. We see substantial opportunity ahead for the company," Steinberg said.

Elliott is buying $1bn in convertible senior notes at an initial conversion price of approximately $22.72 per share, a 30% premium to the stock's closing price on Monday.

Pinterest said it expects to use the proceeds to repurchase shares via a $1bn accelerated share repurchase agreement, which will form part of a new $3.5bn buyback plan, effective from Tuesday.

"We are excited to continue our partnership with Elliott for the next phase of Pinterest's growth. Elliott's investment is a strong vote of confidence in the work we have done to build our business and the significant opportunities ahead for Pinterest," said chief executive Bill Ready.

"Today's repurchase announcement reflects our belief that our current share price undervalues the strength of our business and the significant long-term growth opportunity ahead."

Pinterest shares were up 7.0% at $18.69 by 1622 GMT.