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Oil India Ltd has declared that the company will buy back about 4.45% of the total number of equity shares for an amount aggregating around Rs 1,085 crores, in order to implement government’s plan to push cash-rich PSUs to better utilise their surplus either by paying higher dividends or through share buybacks.
OIL in a their regulatory filing stated that its board had approved buyback of shares at an aggregate of no more than 10% of the fully paid-up equity share capital and free reserves of the company.
The company’s board approved “the buyback by the company of its fully paid-up equity shares of Rs 10 each not exceeding 5.05 crore equity shares at a price of Rs 215 per equity share payable in cash for an aggregate consideration not exceeding Rs 1,085.72 crore.”
Oil which is the second large oil explorer in the country has a cash reserve of little less than Rs 20,000 crores.
According to reports, government is expanding its share buyback program to other major PSU’s such as Coal India, BHEL, NHPC, BHEL, NALCO, NLC, Cochin Shipyard and KIOCL. So far the government has raised just over Rs 15,000 crores out of its targeted Rs. 80,000 Crores through minority stake sale in PSUs.
