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Ford reinstates dividend

Tags: Autos, Ford

Ford Motor Co (F-N) reinstated a dividend for the first time in five years on Thursday, with a quarterly payout of 5 cents US per share that the automaker said it could sustain during any future downturn.

In a statement, Chief Financial Officer Lewis Booth said the dividend, which will be payable in March, "will be sustainable through economic cycles."

Shares of the No. 2 U.S. automaker, which had fallen as much as 3.8 percent earlier in the session, pared losses after the announcement.

Initially, Ford said it would reinstate the dividend after the company achieved an investment-grade credit rating, but recently executives indicated a dividend could come sooner.

Ford last paid a quarterly dividend of 5 cents a share in September 2006, the same month that Alan Mulally became Ford's chief executive.

Mulally is credited with steering the automaker back from the brink of bankruptcy with $23 billion in borrowing and a plan, dubbed "One Ford," to simplify and unify product development and supplies.

Ford, the only U.S. automaker not to take a federal bailout in 2009, is now considered the strongest of the three Detroit automakers. In October, Ford posted its tenth straight quarterly profit.

"The board believes it is important to share the benefits of our improved financial performance with our shareholders," Ford Chairman Bill Ford said in a statement. CTV Two CTV News CTV News Channel BNN - Business News Network CP24