The IT giant Tata Consultancy Services’ board of directors had announced on Jan 12, 2022 of a share buyback of 4 crore equity shares for an aggregate total of Rs 18,000 crore.
On February 13, the company’s members have given a green signal to its share buyback, worth upto Rs 18,000 crore through postal ballot.
Companies usually opt to go for share buyback, also called as share repurchase, in order to increase its shares’ demand in the market. It means when a company buys back its own shares from stakeholders or investors.
In the past, more precisely, in the past five years, the IT bellwether has conducted three share buybacks and the current one would be its fourth buyback since 2017.
On January 12, 2022, Tata-owned IT major TCS had announced a share buyback of 4,00,00,000 equity shares, on a fully paid-up basis, at a face value of Re 1 apiece and at Rs 4,500/share for a total of Rs 18,000 crore.
In a filing on Sunday, the company has announced that its members have approved to undergo a share buyback of up to Rs 18,000 crore.
“The members of the company have approved the buyback by passing a special resolution through postal ballot”, stated the company’s exchange filing.
The record date for determination of the selected equity shareholders’ names eligible for participating in the buyback has been fixed at February 23, 2022.
They hold about 266.91 crore shares in TCS and plan to tender 2.88 crore shares for the buyback. Tata Investment Corporation Ltd (TICL), the non-banking financial company on the other hand, holds 10.23 lakh equity shares of the company and has offered to tender 11,055 shares.
Besides, on Dec 18, 2020, the IT major had offered a share buyback of Rs 16,000 crore, and over 5.3 crore shares of the company were bought at that time, of which 3.33 crore shares by Tata Sons were accepted under the buyback offer.