CorVel Announces Expanded Share Buyback
IRVINE, Calif., June 10 /PRNewswire-FirstCall/ -- CorVel Corporation (Nasdaq: CRVL), reported that the Company's Board of Directors has approved a 850,000 share expansion to its existing stock repurchase plan, increasing the total number of shares approved for repurchase to 15,000,000 shares.
CorVel commenced its share repurchase program in the fall of 1996. Since its inception through June 9, 2010, the Company has spent $223 million to repurchase 13,907,214 shares, equal to 54% of the outstanding common stock had there been no repurchases. These purchases have been funded primarily from the net earnings of the Company. CorVel had 12,026,502 shares of common stock, net of treasury shares, outstanding as of March 31, 2010.
"We have had a consistent practice of using the cash flow generated by the business to make strategic acquisitions to advance our long term growth strategy, or to re-purchase our outstanding common stock. The expansion of our existing stock re-purchase plan provides us ongoing flexibility in the future," said Dan Starck, CorVel's Chief Executive Officer.
The shares in the expanded repurchase program will be purchased from time to time at prevailing market prices, through open market or unsolicited negotiated transactions, depending upon market conditions. There is no guarantee as to the exact number of shares that will be repurchased by CorVel, and the Company may discontinue purchases at any time that management determines additional purchases are not warranted. The purchased shares could be used for general purposes, including issuance under the Company's stock option and stock purchase plans.The Company also announced that pursuant to Board of Directors approval, the Company entered into a pre-arranged stock trading plan to repurchase shares of its common stock. The stock trading plan will be in accordance with guidelines specified under Rule 10b5-1 of the Securities and Exchange Act of 1934 and consistent with CorVel Corporation's policies regarding stock transactions. Rule 10b5-1 allows public companies to adopt written, pre-arranged stock trading plans when they do not have material, non-public information in their possession.
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