AmerisourceBergen 2005 Annual Report Download - page 28

AmerisourceBergen Corporation 2005
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price was approximately $100.1 million, which included the repayment
ofAnderson debt of $13.8 million and $0.8 million of transaction costs
associated with the acquisition. The Company paid part of the purchase
price by issuing 814,145 shares of its common stock with an aggregate
market value of $55.6 million. The Company paid the remaining
purchase price, which was approximately $44.5 million, in cash.
During fiscal 2003, the Company acquired an additional 40%
equity interest in IPN and satisfied the residual contingent obligation
for its initial 20% equity interest for an aggregate $24.7 million in cash.
During fiscal 2003, the Company acquired US Bioservices
Corporation (“US Bio”), a national pharmaceutical products and
services provider focused on the management of high-cost complex
therapies and reimbursement support for a total base purchase price
of $160.2 million, which included the repayment of US Bio debt of
$14.8 million and $1.5 million of transaction costs associated with
this acquisition. The Company paid part of the base purchase price
by issuing 2,399,091 shares of its common stock with an aggregate
market value of $131.0 million. The Company paid the remaining
$29.2 million of the base purchase price in cash. In July 2003, a
contingent payment of $2.5 million was paid in cash by the Company.
During fiscal 2003, the Company acquired Bridge Medical, Inc.,
aleading provider of barcode-enabled point-of-care software designed
to reduce medication errors, to enhance the Company’s offerings in
the pharmaceutical supply channel, for a total base purchase price
of$28.4 million, which included $0.7 million of transaction costs
associated with this acquisition. TheCompany paid part of the base
purchase price by issuing 401,780 shares of its common stock with
an aggregate market value of$22.9 million and the remaining base
purchase price was paid with $5.5 million of cash.
During fiscal 2003, the Company also used cash of $3.0 million
to purchase three smaller companies related to the Pharmaceutical
Distribution segment and paid $9.8 million to eliminate the right of
the former stockholders of AutoMed Technologies, Inc. (“AutoMed”) to
receive up to $55.0 million in contingent payments based on AutoMed
achieving defined earnings targets through the end of calendar 2004.
Cash provided by investing activities for the fiscal year ended
September 30, 2005 included $36.7 million from sale-leaseback
transactions entered into by the Company with a financial institution.
Additionally, cash provided by investing activities included $14.6
million from the sale of substantially all of the assets of Bridge
Medical, Inc. and the sale of Rita Ann Distributors.
In September 2005, the Company issued its 2012 Notes and its
2015 Notes for total proceeds of $895.5 million. These proceeds were
used to finance the early retirement of the 71⁄4%Notes and the 81⁄8%
Notes, including the payment of premiums and other costs, for a total
of $902.3 million. Additionally, during the fiscal year ended September
30, 2005, theCompanypaid$100 million to redeem the Bergen 71⁄4%
Senior Notes and repaid the remaining $180.0 million outstanding
under the Term Loan Facility.
In May 2005, the Company’s board of directors authorized the
Company to purchase up to $450 million of its outstanding shares of
common stock, subject to market conditions and to compliance with
thestock repurchase restrictionscontained in the indentures governing
the Company’s senior notes and in the credit agreement for the
Company’s senior credit facility. Through June 30, 2005, the Company
had purchased $94.2 million ofits common stock under this program
for a weighted average price of $65.50. In August 2005, the Company’s
board of directors authorized an increase to the amount available
under this program by approximately $394 million, bringing total
remaining availability to $750 million, and the total repurchase
program to approximately $844 million. The increase in repurchase
authority was subject to thecompletion ofthetender and repurchase
of the Company’s $500 million principal amount 8.125% senior notes
due 2008 and $300 million principal amount 7.25% senior notes due
2012 and the offering and sale of $400 million principal amount
5.625% senior notes due 2012 and $500 million principal amount
5.875% senior notes due 2015 (collectively, the “Refinancing”). The
Refinancing was completed in September 2005. As of September 30,
2005, the Company has $750 million of remaining authorization to
repurchase its common stock under this program.
In February 2005, the Company’s board of directors authorized
the Company to purchase up to 5.7 million shares (substantially
equivalent to the number of common stock shares issued in connection
with the conversion of the 5% notes) of its outstanding common
stock, subject to market conditions. In February 2005, the Company
acquired 0.4 million shares in the open market for a total of $25.9
million. In addition, on March 30, 2005, the Company entered into
an Accelerated Share Repurchase (“ASR”) transaction with a financial
institution to purchase the remaining 5.3 million shares immediately
from the financial institution at a cost of $293.8 million. The financial
institution subsequently purchased an equivalent number of shares in
the open market through April 21, 2005. The ASR transaction was
completed on April 21, 2005; as a result, the Company paid the
financial institution a cash settlement of $16.6 million. The Company
had acquired all the shares authorized under this program for a total
of $336.3 million, which includes the above cash settlement of
$16.6 million. Thecash settlement was recorded as an adjustment
to additional paid-in capital.
In August 2004, the Company’s board of directors authorized the
Companyto purchase up to $500 million ofits outstanding shares of
common stock, subject to market conditions. During the fiscal year
ended September 30, 2004, the Company had acquired 2.8 million
shares of its Common Stock for $144.7 million. During the fiscal year
ended September 30, 2005, the Company acquired 6.5 million shares
of its common stock under this program for $355.3 million. As of
September 30, 2005, the Company had acquired 9.3 million shares of
its common stock to complete the $500 million repurchase program.
As previously described, the Company used $300 million to
redeem theSubordinated Notes and $8.4 million to redeem the 67⁄8%
Notes during the fiscal year ended September 30, 2004. Additionally,
theCompany repaid$60 million of the Term Facility in fiscal 2004.
During the fiscal year ended September 30, 2003, the Company
issued the aforementioned $300 million of 71⁄4%Notes. The Company
used the net proceeds of the 71⁄4%Notes to repay $15 million of the
Term Facility,to repay $150 million in aggregate principal of the
Bergen 73⁄8%senior notes and redeem the PharMerica 83⁄8%senior
subordinated notes due 2008 at a redemption price equal to 104.19%
of the $123.5 million principal amount. The Company also repaid an
additional $45 million of the Term Facility, as scheduled.
The Company has paid quarterly cash dividends of $0.025 per
share on its common stock since the first quarter of fiscal 2002. On
November 15, 2005, the Company’s board of directors increased the
quarterly dividend by 100% and declared a dividend of $0.05 per share,
which will be paid on December 12, 2005 to stockholders of record as
ofclose ofbusiness on November 25, 2005. TheCompanyanticipates
that it will continue to pay quarterly cash dividends in the future.
However, the payment and amount of future dividends remain within
thediscretion of the Company’s board of directors and will depend
upon the Company’s future earnings, financial condition, capital
requirements and other factors.