Share buy back scheme

[Fhydvjtfg]

I don't understand? Could someone please explain why SUNINT wants to buy back its shares for the purpose of eventually delisting them? Secondly, why SUNINT do not buy back the shares they desire about 16%, in the open market, at the market price. Is it fair that shareholders will be forced to sell a portion of their holdings at a price of just over R145, when at the same time, the shares are trading at above R158? I battle to see the incentive.

[Plonky]

Good question. If the shares will be bought back at R145 why has the share touched R160 today. ? (+4% improvement from friday)

[saash]

On 29 June there will be a Special General Meeting at which shareholders are entitled to vote for or against the proposed resolutions which facilitate the buy-back. My understanding of the effect is that ordinary shareholders would be selling back to the company at an average price over a 1 month period, after which the total shares left in issue would be fewer (therefore the percentage held by the shareholders is stronger than before the buy-back). This will advantage shareholders by promoting a stronger share price for the shares still in issue (for example, insted of owning 0.16% of the company's assets you'll now own 0.17%), while at the same time improving the company's BEE structure which will improve the competitiveness of the business - therein lies the incentive to shareholders. Effectively you are getting paid out for your 16% as a dividend, and the future trading value of what shares you still hold is going to be worth about the same or more than the value that the whole lot is worth now (PRESUMING THE MARKET IS HAPPY WITH THE MOVE AFTER THE MEETING).

[#4]

As an American fundi was quoted :"Companies buy back their shares to make their EPS look better."...