PALO ALTO, Calif., Aug. 26, 2011 /PRNewswire/ — Varian Medical
VAR) today announced that it has entered into an agreement with
Bank of America, N.A. to repurchase $250 million of its common
stock under an accelerated share repurchase program.
Concurrently, the company amended its revolving credit
facility with Bank of America, N.A. to increase its borrowing
capacity from $225 million to $300 million.
Under the accelerated repurchase agreement, Varian will pay $250
million to Bank of America N.A. and receive approximately 3.8
million shares, or 85 percent of the shares to be repurchased based
on the closing share price of the company’s common stock on August
24, 2011. The total number of shares ultimately repurchased
under the agreement will be determined upon final settlement.
Varian will either receive additional shares of common stock
or under certain circumstances be required to remit a settlement
amount payable at Varian’s option in cash or common stock, based
generally on the volume weighted average share price of Varian’s
common stock during the next three to six months.
“Accelerated repurchase programs have been an ongoing element of
our overall strategy for returning value to our investors,” said
Tim Guertin, president and CEO of Varian Medical Systems. The
program is expected to be accretive to earnings going forward but
have minimal impact on fiscal year 2011.
These shares will be acquired under the remainder of a 12
million share repurchase authorization approved by the company’s
Board of Directors on February 11, 2011 with an expiration at the
end of fiscal year 2012. At the conclusion of the accelerated
share repurchase program, the company expects that approximately
7.4 million shares will remain under the February 11, 2011
authorization, depending on the company’s stock price during the