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Buy back of shares

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A Company wants to provide financial assistence to its employees to enable them to subscribe for fully paid shares of the company

Does it amounts to purchase of its own shares??

Replies (2)

Manu,

It is not considered as buy back of shares but what is point in lending companies money to employees to purchase its own shares, general company issues shares to raise money, when there is no money in company for business operations. if company proposes to make employees part of company by issuing shares, it can do it so by following employee stock option scheme or sweat equity scheme.

 

Thanks Sir


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