Altria (NYSE: MO) hasn't had a lot of good news to report lately, but investors were cheering its latest move on Thursday, which will raise billions in cash.

The Marlboro maker said it would sell a significant percentage of its stake in Anheuser-Busch InBev (NYSE: BUD). News of the sales sent the high-yielding dividend stock up 2.2% on Thursday.

In a filing, Altria said it plans to sell 35 million shares of Anheuser-Busch through a public offering at $61.50 a share, and in addition, it would sell $200 million worth of the stock directly to Anheuser-Busch. In total, Altria expects to receive $2.4 billion from the sale. The underwriters also have the option of purchasing an additional 5.25 million Anheuser-Busch shares from Altria, for which Altria would receive an additional $323 million, not including any fees associated with the transaction.

Altria will still retain a majority of the stake it had previously held in ABI, now worth approximately 8.1%, or roughly $10 billion of the alcohol giant.

Altria's plan for the new capital

Altria has long been a cash machine and returns most of its profits to investors in the form of a generous dividend. Historically, the company aims for a dividend payout ratio of 80%. Given its focus on returning capital to shareholders, it shouldn't come as a surprise that Altria is returning the new capital to shareholders, this time in the form of buybacks.

The company said it was increasing its existing $1 billion share repurchase program by $2.4 billion. It expects to complete those share repurchases by the end of the year as part of an accelerated share repurchase program.

CEO Billy Gifford said: "We have a long-standing history of returning cash to our shareholders, and today's announcement reflects our continued desire to create long-term shareholder value."

With Altria's market cap currently sitting at around $80 billion, the additional repurchases will have an immediate effect, leading the company to raise its full-year adjusted earnings per share guidance from $5.00 to $5.15 to $5.05 to $5.17. This represents a growth rate of 2% to 4.5% from $4.95 in 2023. It also expects cash savings by reducing the number of shares that it needs to pay dividends on. Finally, the move will reduce its equity earnings from ABI, but it's still a net positive for earnings on a per-share basis.

Is it the right move?

Altria's minority stake in ABI is something of an accident of history. Philip Morris, as the company was known for most of its history, acquired Miller Brewing in 1969 at a time when the tobacco giant was diversifying its business interests. SAB acquired Miller in 2002, but Philip Morris retained a minority stake in the company. When Anheuser-Busch acquired SABMiller in 2016, that stake dwindled again, but the tobacco giant still held on to some.