HCL Technologies Announces Rs 3,500-Crore Share Buyback
After TCS and Cognizant, HCL Technologies announces buyback of shares.
India's fourth largest software services firm HCL Technologies Ltd. said it will buyback shares at Rs 1,000 apiece, a 17 percent premium over Wednesday’s closing price.
The company is proposing an offer for buyback of equity shares for cash at a price of Rs 1,000 per equity shares on a proportionate basis through tender offer process, HCL Technologies said in a regulatory filing.
The buyback size is Rs 3,500 crore, representing 16.39 percent and 13.62 percent of the aggregate of the fully paid-up equity share capital and free reserves as per the standalone and consolidated audited accounts of the company for the financial year ended March 31, it added.
HCL said the letter of offer will be made to equity shareholders of the company as on record date of May 25. Opening and closing dates of buyback programme, which received shareholder approval last month has not yet been announced.
The Indian IT companies have been under pressure to return excess cash on their books to shareholders through generous dividends and buybacks. Earlier this month, India's largest software services firm Tata Consultancy Services Ltd. announced its Rs 16,000-crore buyback offer. It is currently under way.
Infosys has also announced its capital allocation policy to return up to Rs 13,000 crore this financial year through dividend and/or buyback.
Earlier this year, Cognizant announced a $3.4 billion share buyback, bowing to pressure from activist investor Elliott Management Corp.
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