Buy back of shares

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CA Saxena (Querist)
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12 February 2013 Want to buy back approx 12% shares in a pvt limited company at PAR VALUE from a single shareholder

Is it possible to do so??

What is the procedure and forms that need be filed.

Thanks in anticipation.

Ajay Mishra

Ajay Mishra (Expert)
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12 February 2013 Hi

You can.

The following terms and conditions are required to be fulfilled by a company in order to become eligible to buy-back its own securities:—
(a) There must be a provision in the Articles of Association authorising the company to buy-back its own shares, otherwise the Articles must be amended by a special resolution to incorporate a suitable provision.
(b) A special resolution must also be passed in a general meeting of the company authorising the Board of directors to buy-back the shares of the company or other specified securities. upto 25% of the total paid-up capital and free reserves provided that the buy-back of equity shares in any financial year shall not exceed 25% of its total paid-up equity capital in that financial year.
(c) The maximum quantum of buy-back can be upto 10% of the total paid up capital and free reserves by the authority of the Board by means of resolution of the Board meeting.

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CA Saxena

CA Saxena (Querist)
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12 February 2013 sir, can buy back be done at par value of shares??

Ajay Mishra

Ajay Mishra (Expert)
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12 February 2013 Hi

I am not sure on this, but it can be par value in case of un-listed company as a minimum price of buy back.

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