This study finds that a firm can use share repurchase as a signal to overcome the information asymmetry that exists between managers and stockholders, which benefits stockholders’ wealth (information premium effect). This information premium effect of share repurchases can be socially beneficial due to the reduction of information asymmetry risks and agency costs. In addition, the information flow in a supply chain is an important mechanism for business activities since a firm often benefits more by gaining information advantage relative to its business counterparties in business transactions. This decline in a repurchasing firm’s information asymmetry after a repurchase announcement causes the firm in a position of information disadvantage relative to its business counterparties, which impairs the firm’s stockholders’ wealth (relative information advantage effect). Therefore, a share repurchase action mitigates information asymmetry, which lowers a firm’s financing costs and provides positive news to the market, however, weakens the firm’s information advantage and enhances the bargaining powers of its suppliers and customers.