FMCG major Hindustan Unilever (HUL) on Tuesday said the procedure to buyback 55.16 crore equity shares amounting to 25 per cent of the company from the shareholders would commence on October 3.
Hindustan Unilever would buy-back its fully paid-up equity shares of face value of Re 1 each for upto Rs 230 per share from the existing registered shareholders or beneficial owners of the equity shares.
The company has set aside Rs 630 crore to buy back upto 25 per cent of its stake at a price not exceeding Rs 230 per share and the buy-back would be implemented by way of open market purchases through the Bombay Stock Exchange and the National Stock Exchange.
The buy back would commence on October 3 and would close on September 13, 2008 or when HUL has completed the process of acquiring 25 per cent of the equity stake for upto Rs 630 crore whichever is earlier.
The buyback offer was approved by the board of directors on July 29 and by the shareholders on September 14.
Earlier, HUL Chairman Harish Manwani said the company had Rs 2,261 crore net liquid funds, of which only about 25 per cent was set aside for the buyback. Although it is for the first time the company is using excess funds for buyback, it had earlier returned excess funds on its balance sheet to shareholders by way of bonus debentures.
The proposed buyback would marginally increase the equity stake of the parent Unilever, which holds 51.4 per cent. Shares of the company closed at Rs 227.05, down 1.57 per cent on the BSE.
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