Share Buyback vs Debt Paydown

This article from Mike Carpenter of Millipore is not a traditional article we would feature on the CPMA, but as portfolio management's aim is to figure out how to optimize how resources are allocated, we thought Mike's excellent article about another thorny resource allocation issue would be of interest to some of our membership.  The article abstract is below and the article can be downloaded as a pdf below.

This article provides a quantitative framework to help CFOs answer the question, "If I have excess cash, would it be more EPS accretive to buy back shares or to pay down debt?"  Conceptually, buying back shares increases EPS by lowering the number of shares outstanding, while paying down debt raises EPS by reducing interest expense, which in turn improves earnings.