What is the purpose of this new share repurchase program?

The purpose of the new share repurchase program is to allow McKesson to buy back its own stock, which can be used for general corporate purposes. This also signals management's belief that the company's stock is undervalued and is a way to return capital to shareholders.

How much has McKesson repurchased previously?

McKesson had previously authorized a $250 million share repurchase program in August 2005. As of the filing date, approximately $4 million of that authorization remained unutilized.

What is McKesson's financial capacity to execute this buyback?

McKesson appears to have significant financial capacity. As of September 30, 2005, the company had $3.0 billion in cash and approximately 308 million shares outstanding. This strong cash position provides ample resources to fund the $250 million repurchase program.

What will happen to the shares repurchased?

The shares repurchased under this program will be held as treasury shares. Treasury shares are essentially shares that the company has bought back from the open market and can be reissued later for various corporate needs, such as employee stock options or acquisitions.

MCK 8-K SEC Disclosure

Summary

McKesson Corporation announced on December 6, 2005, that its Board of Directors has authorized a new share repurchase program of up to $250 million. This new authorization follows a prior $250 million program initiated in August 2005, of which approximately $4 million remained unutilized. The company intends to repurchase shares from time to time through open market or private transactions. These repurchased shares will be held as treasury stock and can be used for general corporate purposes. As of September 30, 2005, McKesson had approximately 308 million shares outstanding and a substantial cash balance of $3.0 billion, indicating a strong financial position to support this capital allocation strategy. This move suggests management's confidence in the company's value and its commitment to returning capital to shareholders.

Key Highlights

1McKesson's Board of Directors authorized a new share repurchase program of up to $250 million.
2The new repurchase program will be executed through open market or private transactions.
3This authorization is in addition to a previous $250 million program, with approximately $4 million remaining.
4Repurchased shares will be held as treasury stock for general corporate purposes.
5As of September 30, 2005, McKesson reported approximately 308 million shares outstanding.
6The company held $3.0 billion in cash as of September 30, 2005, providing ample financial capacity for the repurchase.

MCKESSON CORP 8-K Report, Corporate Update (Dec 7, 2005)

Summary

Key Highlights

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