Ann: Webcentral Acquires New Domain Services, page-32

In most situations two conditions are required before buying back shares:

A) when interest rates are forecast to remain low and dividend payments are relatively higher. This type of capital management reduces the average cost of capital.

Generally the average cost of capital is a key component of your internal hurdle rate and determines the capital allocation budget, subject to investment opportunities

AND

B) your investment team cannot identify risk adjusted capital investments that will either:
i) earn more than the hurdle rate, ( and are aligned to your competencies),
OR
ii) if that capex project cannot create savings where the annual savings is more than the hurdle rate x capex used

There is one other unique situation for buying back small parcels of shares:
* consolidating small holdings that incur excessive maintenance costs - which WCG did well for small pockets.

in my opinion