Genentech extends stock repurchase program

The board of US biotechnology giant Genentech has authorized the extension of its current share repurchase program for up to an additional $2.0 billion of its common stock for a total of $8.0 billion through June 30, 2008. The board maintained the maximum number of shares that can be repurchased at 100 million shares.

As of March 31, Genentech - which is majority-owned by Switzerland's Roche - had purchased around 67 million shares under the program at an aggregate cost of about $4.8 billion. The board initially approved $1.0 billion for repurchases in December 2003 and extended this an additional $1.0 billion in September of 2004, a further $2.0 billion in June 2005, and another $2.0 billion in April of 2006.

Genentech intends to use the repurchased stock to offset dilution caused by the issuance of shares in connection with the firm's employee stock plans. The goals of the company's stock repurchase program are to make prudent investments of its cash resources, to allow for an effective mechanism to provide stock for the stock plans, and to address provisions of the affiliation agreement with Roche relating to its minimum ownership percentage in Genentech stock.