It is when a company offers to purchase shares from the shareholders and extinguish those shares.
Furthermore, companies have become accustomed to considering the provisions of Section 48 of the Act when attending to share buybacks. In the application of Section 48 of the Act however, many companies fall foul of the application.
Companies may, however, have to be fairly cautious in respect of determining which individuals are to be considered as prescribed officers, as envisaged in Regulation 38 of the Companies Regulations, Section 48 8 b of the Act, however, may prove to be more complicated to comply with.
Such a report must be prepared as a report to the board of the company and must be distributed to all holders of the securities of the company and must address the following matters: The requirements in respect of the independent expert retained in order to compile the relevant report, is relatively stringent.
The following criteria applies to the independent expert retained: Such person must be qualified, and have the competence and experience necessary, to understand the type of share buyback transaction proposed, to evaluate the consequences of the proposed share buyback transaction, and to assess the effect of the share buyback transaction on the value of securities and rights and interests of the shareholders and creditors of the company; Such person must be able to express opinions, exercise judgement and make decisions impartially; and Such person retained must not — have any other relationship with the company or with a proponent of the share buyback transaction, that would lead a reasonable and informed third party to conclude that the integrity, impartiality or objectivity of such person is compromised; have had any relationship as envisaged above within the immediately preceding 2 years; or be related to a person who has or has had a relationship as envisaged above.
Nicole Gomes Legal Advisor, Johannesburg.Nirmal Bang is an online stock & share market trading company in India offering equities, commodities, mutual funds, insurance, IPOs, derivatives, currencies, DP & free demat A/C.
Companies buy back shares on the open market over an extended period of time and may even have an outlined share repurchase program that purchases shares at certain times or at regular intervals. A company can fund its buyback by taking on debt, with cash on hand or with its cash flow from operations.
Sep 03, · share buyback: Find Latest Stories, Special Reports, News & Pictures on share buyback. Read expert opinions, top news, insights and trends on The Economic Times.
JB Chemicals' board approves share buy-back for up to Rs crore 31 Aug, , PM IST. Qualcomm Inc.
on Tuesday unveiled the first part of a share buyback program authorized last week after scrapping a bid to buy NXP Semiconductors NV. The chip maker will buy up to $10 billion worth. Interesting ICO'S and Tokens. Many ICO's scream Buyer Beware, and while all these tokens carry serious risk, these are some projects doing some interesting things.
Buy Back Buy-Back is a corporate action in which a company buys back its shares from the existing shareholders usually at a price higher than market price. When it buys back, the number of shares outstanding in the market reduces.