USA: Constellation Brands to repurchase $500 mln of its own stock

Constellation Brands, Inc., a leading beverage alcohol company, announced on April 7 that it has entered into an accelerated share repurchase (“ASR”) agreement with Bank of America, N.A. to repurchase $500.0 million of its Class A common stock (“Common Stock”).

Under the ASR agreement, Constellation will receive approximately 1.7 million shares on April 8, 2022, representing approximately 80% of the expected share repurchases under the ASR agreement, based on the company’s April 6, 2022 closing stock price of $231.81. The repurchased shares will become treasury shares.

The specific number of shares to be repurchased in the transaction is generally based upon the volume-weighted-average price of the Common Stock during the term of the ASR agreement, less a discount and is expected to be completed no later than May 2022. The purchase price for shares repurchased in the accelerated share repurchase transaction will be paid primarily with cash on hand and will be completed under the company’s current share repurchase authorization, which currently has approximately $2.6 billion in authorization remaining before giving effect to the ASR.

This ASR agreement will not change the fiscal 2023 EPS guidance provided in our news release of earlier today and constitutes the $500 million share repurchase referenced in that news release.