AmerisourceBergen Announces Special $650 Million Share Repurchase Program to Supplement Warrant Hedging Strategy

  AmerisourceBergen Announces Special $650 Million Share Repurchase Program to
  Supplement Warrant Hedging Strategy

Business Wire

VALLEY FORGE, Pa. -- May 19, 2014

AmerisourceBergen Corporation (NYSE:ABC) today announced that its Board of
Directors has authorized a special $650 million share repurchase program
intended to supplement the Company’s previously announced warrant hedging
strategy. The special program will be used to mitigate the potentially
dilutive effect on the ownership interests of its then-existing stockholders
that may result from the issuance of common stock upon exercise of the
warrants issued in March 2013.

Share repurchases under the special program are expected to take place over an
extended period of time, subject to market conditions. The Company intends to
exclude the impact of the share repurchases under the special program from its
presentation of adjusted diluted earnings per share from continuing operations
beginning with its earnings release for the fiscal quarter ending June 30,
2014 and until the warrants are exercised or expire. The exclusion of the
special share repurchases will be consistent with the Company’s exclusion of
the accounting dilution resulting from the impact of the warrants in the
calculation of the Company’s adjusted diluted earnings per share. As a result,
share repurchases under the special program will not have an impact on the
Company’s expectations for the range of its adjusted diluted earnings per
share from continuing operations for fiscal 2014, which was previously
disclosed in its earnings release dated April 24, 2014. That range continues
to include an assumption that the Company will repurchase $500 million of its
common stock in fiscal 2014 under its previously announced repurchase
programs, subject to market conditions.

As previously disclosed, subsidiaries of Walgreen Co. and Alliance Boots GmbH
were collectively issued warrants to purchase up to 22,696,912 shares of the
Company’s common stock at an exercise price of $51.50 per share exercisable
during a six month period beginning in March 2016 and warrants to purchase up
to 22,696,912 shares of the Company’s common stock at an exercise price of
$52.50 per share exercisable during a six-month period beginning in March
2017. Once completed, the share repurchases under the special program,
together with the issuer capped call option transactions described in the
Company’s Form 10-Q for the fiscal quarter ended March 31, 2014, are expected
to mitigate approximately 80% of the potentially dilutive effect that the
issuance of shares of the Company’s common stock upon exercise of the warrants
could have. The Company will continue to explore additional opportunities to
mitigate any remaining potentially dilutive effect of the warrants.

About AmerisourceBergen

AmerisourceBergen is one of the largest global pharmaceutical sourcing and
distribution services companies, helping both healthcare providers and
pharmaceutical and biotech manufacturers improve patient access to products
and enhance patient care. With services ranging from drug distribution and
niche premium logistics to reimbursement and pharmaceutical consulting
services, AmerisourceBergen delivers innovative programs and solutions across
the pharmaceutical supply channel. With over $100 billion in annualized
revenue, AmerisourceBergen is headquartered in Valley Forge, PA, and employs
approximately 13,000 people. AmerisourceBergen is ranked #32 on the Fortune
500 list. For more information, go to www.amerisourcebergen.com.

AmerisourceBergen's Cautionary Note Regarding Forward-Looking Statements

Certain of the statements contained in this news release are “forward-looking
statements” within the meaning of Section 27A of the Securities Act of 1933
and Section 21E of the Securities Exchange Act of 1934. Words such as
“expect,” “likely,” “outlook,” “forecast,” “would,” “could,” “should,” “can,”
“will,” “project,” “intend,” “plan,” “continue,” “sustain,” “synergy,” “on
track,” “believe,” “seek,” “estimate,” “anticipate,” “may,” “possible,”
“assume,” variations of such words, and similar expressions are intended to
identify such forward-looking statements. These statements are based on
management’s current expectations and are subject to uncertainty and change in
circumstances. These statements are not guarantees of future performance and
are based on assumptions that could prove incorrect or could cause actual
results to vary materially from those indicated. Among the factors that could
cause actual results to differ materially from those projected, anticipated,
or implied are the following: changes in pharmaceutical market growth rates;
the loss of one or more key customer or supplier relationships; the retention
of key customer or supplier relationships under less favorable economics;
changes in customer mix; customer delinquencies, defaults or insolvencies;
supplier defaults or insolvencies; changes in branded and/or generic
pharmaceutical manufacturers’ pricing and distribution policies or practices;
adverse resolution of any contract or other dispute with customers or
suppliers; federal and state government enforcement initiatives to detect and
prevent suspicious orders of controlled substances and the diversion of
controlled substances, federal and state prosecution of alleged violations of
related laws and regulations, and any related litigation, including
shareholder derivative lawsuits or other disputes relating to
AmerisourceBergen’s distribution of controlled substances; qui tam litigation
for alleged violations of fraud and abuse laws and regulations and/or any
other laws and regulations governing the marketing, sale, purchase and/or
dispensing of pharmaceutical products or services and any related litigation,
including shareholder derivative lawsuits; changes in federal and state
legislation or regulatory action affecting pharmaceutical product pricing or
reimbursement policies, including under Medicaid and Medicare, and the effect
of such changes on AmerisourceBergen’s customers; changes in regulatory or
clinical medical guidelines and/or labeling for the pharmaceutical products we
distribute; price inflation in branded and generic pharmaceuticals and price
deflation in generics; greater or less than anticipated benefit from launches
of the generic versions of previously patented pharmaceutical products;
significant breakdown or interruption of AmerisourceBergen’s information
technology systems; AmerisourceBergen’s inability to realize the anticipated
benefits of the implementation of an enterprise resource planning (ERP)
system; interest rate and foreign currency exchange rate fluctuations; risks
associated with international business operations, including non-compliance
with the U.S. Foreign Corrupt Practices Act, anti-bribery laws and economic
sanctions and import laws and regulations; economic, business, competitive
and/or regulatory developments in countries where we do business and/or
operate outside of the United States; risks associated with the strategic,
long-term relationship among Walgreen Co., Alliance Boots GmbH, and
AmerisourceBergen, the occurrence of any event, change or other circumstance
that could give rise to the termination, cross-termination or modification of
any of the transaction documents among the parties (including, among others,
the distribution agreement or the generics agreement), an impact on
AmerisourceBergen’s earnings per share resulting from the issuance of the
warrants to subsidiaries of Walgreen Co. and Alliance Boots GmbH (the
“Warrants”), an inability to realize anticipated benefits (including benefits
resulting from participation in the Walgreens Boots Alliance Development GmbH
joint venture), the disruption of AmerisourceBergen’s cash flow and ability to
return value to its stockholders in accordance with its past practices,
disruption of or changes in vendor, payer and customer relationships and
terms, and the reduction of AmerisourceBergen’s operational, strategic or
financial flexibility; the acquisition of businesses that do not perform as we
expect or that are difficult for us to integrate or control;
AmerisourceBergen’s inability to implement its hedging strategy to mitigate
the potentially dilutive effect of the issuance of shares of its common stock
upon exercise of the Warrants, including its inability to repurchase shares of
its common stock under its new share repurchase program due to its financial
performance, the current and future share price of its common stock, its
expected cash flows, competing priorities for capital, and overall market
conditions; AmerisourceBergen’s inability to successfully complete any other
transaction that we may wish to pursue from time to time; changes in tax laws
or legislative initiatives that could adversely affect AmerisourceBergen’s tax
positions and/or AmerisourceBergen’s tax liabilities or adverse resolution of
challenges to AmerisourceBergen’s tax positions; increased costs of
maintaining, or reductions in AmerisourceBergen’s ability to maintain,
adequate liquidity and financing sources; volatility and deterioration of the
capital and credit markets; natural disasters or other unexpected events that
affect AmerisourceBergen’s operations; and other economic, business,
competitive, legal, tax, regulatory and/or operational factors affecting
AmerisourceBergen’s business generally. Certain additional factors that
management believes could cause actual outcomes and results to differ
materially from those described in forward-looking statements are set forth
(i) in Item 1A (Risk Factors) and Item 1 (Business) in the Company’s Annual
Report on Form 10-K for the fiscal year ended September 30, 2013 and elsewhere
in that report and (ii) in other reports.

Contact:

AmerisourceBergen Corporation
Barbara Brungess, 610-727-7199
Vice President, Corporate & Investor Relations
bbrungess@amerisourcebergen.com
 
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