Tags:
Journalism of Courage
The board of Carin India Ltd will on Tuesday consider a proposal to buy back shares,a move which will help promoters Vedanta Group increase its stake in the company without putting any money.
Cairn,which is sitting on a cash pile of about 3 billion,in a filing to the stock exchanges said,A meeting of the board of directors of the company will be held on November 26,to consider the proposal for buy back of equity shares of the company.
Share buy-back is the process where a company repurchases outstanding shares in order to reduce the number of shares in the market.
Companies,as a rule,buy back shares either to increase the value of shares still available reducing supply,or to eliminate any threats by shareholders who may be looking for a controlling stake.
As per Sebi rules,Cairn will buy a pre-decided quantity of shares from the market at a rate which is likely to be higher than current trading price. Such shares will be held as treasury stock and eventually extinguished.
