The board of
Parexel International Corporation
(
PRXL
), leading provider of biopharmaceutical services, recently cleared
a share repurchase program authorizing the company to buyback up to
$200 million of its common stock. The share repurchase program is
subject to the approval of Parexel's lenders. The company has not
announced the expiration date for the program.
Parexel has cancelled its previous share repurchase program, of
which $6 million still remained. The company has not specified the
amount of common stock to be repurchased though it could be
altered, extended, withheld or discontinued at any time. The share
buyback will reduce the number of shares outstanding which stood at
60.1 million as of June 30, 2012.
The repurchase of shares will increase Parexel's shareholder
value in the long run. The announcement is not only expected to
reinforce shareholders' confidence but also boost the market value
of the outstanding shares. The authorization program underlines the
company's commitment to optimize its capital structure and business
fundamentals.
The company intends to fund the share repurchase with its
existing cash on its balance sheet, cash flow from operations,
credit facilities as well as other financing activities. Parexel
exited fiscal 2012 with cash and cash equivalents of approximately
$214 million and available credit of $175 million.
Management will have the discretionary power to decide the
timing and amount of share buyback on the basis of a number of
factors such as corporate requirements, share trading price and
overall market situation. The program is also subject to legal
obligations including federal and state securities laws. Parexel
seeks to execute the program in the open market through a broker
dealer, in block trades or in negotiated transactions.
Waltham, Massachusetts-based Parexel is a leading
biopharmaceutical services company. It provides clinical research,
consultation and commercialization as well as technology products
to various industries such as pharmaceutical, biotechnology and
medical devices. The company operates in three major segments -
clinical research services, Parexel consulting and medical
communications services and perceptive informatics. It competes
with
Covance Inc.
(
CVD
) among others.
Parexel currently retains a Zacks #3 Rank, which translates into
a short-term Hold rating.
COVANCE INC (CVD): Free Stock Analysis Report
PAREXEL INTL CP (PRXL): Free Stock Analysis
Report
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