Allergan Authorizes New $2 Billion Share Buyback and Affirms Commitment to Dividend Increase

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DUBLIN— Allergan plc (NYSE: AGN) has authorized a new $2 billion share repurchase program and affirmed its commitment to increase its cash dividend for shareholders as part of a capital allocation strategy, according to an announcement earlier this week.

Allergan also reaffirmed its commitment to pay down $3.75 billion of debt in 2018, which the company said represents its commitment to maintaining investment-grade credit ratings, according to the announcement.

“These actions reflect the company's conviction in its business strategy and strong future cash flow position, allowing for periodic return of cash to shareholders through dividends and share buybacks while maintaining investment grade ratings and continuing its debt pay down strategy,” the announcement noted.

Allergan reaffirmed 2017 financial guidance and its third-quarter revenue projections in the announcement, also.

“We continue to believe that Allergan stock is substantially undervalued, and the share price today presents a unique investment opportunity for the company,” Brent Saunders, chairman, chief executive and president of Allergan, said in the statement.

Saunders noted the board of directors’ actions to approve these new moves follows a recently completed repurchase of $15 billion of company common stock.

In a separate announcement, Allergan said executive vice president and chief financial officer Tessa Hilado has decided to retire. The company has initiated a search to fill the CFO position, and in the meantime Hilado will continue in her role until a successor is named, in order to ensure a smooth transition.