Proceeds from the company’s recently concluded debt offering were used to execute the ASR, which is part of Merck’s previously announced $15 billion share repurchase program.
“This accelerated share repurchase demonstrates our commitment to delivering increased value to shareholders in the short term, while continuing to invest in the important opportunities that will drive our long-term growth,” said Kenneth C. Frazier, chairman and chief executive officer, Merck.
Under the terms of the ASR, Merck has agreed to repurchase $5 billion of its common stock from Goldman, Sachs & Co., in total, with an initial delivery of approximately 99.5 million shares based on current market prices. The final number of shares to be repurchased will be based on Merck’s volume-weighted average stock price during the term of the transaction, which is expected to be completed no later than November 25, 2013.
In the first four months of 2013, Merck repurchased approximately 17.8 million shares for a total of $772 million. As of April 30, 2013, the company’s total outstanding share repurchase authorization was $16.1 billion, which included $1.1 billion in authorized repurchases remaining under the program previously announced on April 27, 2011.