Ajanta Pharma’s board on Friday approved the proposal for buyback of shares. 315 crores at the cost of 1,425 per share through the tender offer route. The company will buyback approximately 22,10,500 equity shares of the company, which will constitute 2.59% of the total equity. Pharma stock was trading with a fall of more than one percent 1,213 on the BSE in afternoon deals.
“We wish to inform you that the Board of Directors of the Company in its meeting held today has, inter alia, considered and approved buyback of 22,10,500 fully paid-up equity shares of face value Rs. 2/- each by the company 1,425/- not exceeding the total consideration payable in cash 315 crore, which represents an aggregate of 9.93% and 9.64% of the paid-up capital and free reserves as per the standalone and consolidated audited financials for the year ended March 31, 2022,” Ajanta Pharma informed in an exchange filing.
The Board further considered and approved the Record Date for the proposed Buyback Offer and fixed Friday, March 24, 2023 for the purpose of determining the rights and names of the Equity Shareholders who would participate in the proposed Offer of Buyback Will be entitled to take Up to 22,10,500 Equity Shares of the Company at a cost of Rs. 1,425/- per equity share.
The total payment for buyback of shares shall not exceed 389 crore (not exceeding the equity share buyback consideration Not more than 315 cr + buyback tax 74 crore) through tender offer process on pro-rata basis, the company added.
A share buybackA stock buyback, also known as a share repurchase, is a corporate action to buy back its own outstanding shares from its existing shareholders, usually at a premium to the prevailing market price. This can be an alternative tax-efficient way of returning money to shareholders. Share buybacks reduce the number of shares in circulation, which can increase share price and earnings per share (EPS).
Ajanta Pharma is a pharmaceutical formulations company with generic business in India and emerging markets in the US and institutional business in Africa. The stock is up about 4% over the one-year period.
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