Illinois Tool Works (NYSE:ITW) has crafted a higher payout for its shareholders. The company declared a quarterly distribution of $0.42 per share, to be paid on October 8 to shareholders of record as of September 30. That amount is $0.04, or 10.5%, higher than the company's preceding disbursement of $0.38; this was paid last month.

The new dividend annualizes to $1.68 per share, yielding 2.3% at Illinois Tool Works' current stock price of $74.24.

The company also authorized a buyback program for up to $6.0 billion worth of its common stock. The program is open-ended, and does not have an expiration date. It adds to what's left of the existing repurchase initiative; as of June 30, $1.2 billion remained of the original $4.0 billion authorized in May 2011.

Currently, Illinois Tool Works has just under 450 million shares outstanding.