Part XIII Share Buy-Back
An issuer may purchase its own shares ("share buy-back") if it has obtained the prior specific approval of shareholders in general meeting.
A share buy-back may only be made by way of:(1) on-market purchases transacted through the Exchange's trading system or on another stock exchange on which the issuer's equity securities are listed ("market acquisition"); or(2) off-market acquisition in accordance with an equal access scheme as defined in Section 76C of the Companies Act.
Unless a lower limit is prescribed under the issuer's law of incorporation, such share buy-back shall not exceed 10 per cent of the total number of issued shares excluding treasury shares and subsidiary holdings in each class as at the date of the resolution passed by shareholders for the share buy-back.
For the purpose of obtaining shareholder approval, the issuer must provide at least the following information to shareholders:—(1) The information required under the Companies Act;(2)(The reasons for the proposed share buy-back;(3) The consequences, if any, of share purchases by the issuer that will arise under the Takeover Code or other applicable takeover rules;(4) Whether the share buy-back, if made, could affect the listing of the issuer's equity securities on the Exchange;(5) Details of any share buy-back made by the issuer in the previous 12 months (whether market acquisitions or off-market acquisitions in accordance with an equal access scheme), giving the total number of shares purchased, the purchase price per share or the highest and lowest prices paid for the purchases, where relevant, and the total consideration paid for the purchases; and(6) Whether the shares purchased by the issuer will be cancelled or kept as treasury shares.
Rules 881 to 883 and 884 to 885 are not applicable to an issuer which purchases its own shares for the purpose of Rule 210(11)(m)(x) in paying a pro rata portion of the amount held in the escrow account to independent shareholders. The issuer must immediately cancel all the shares it purchased and make an announcement on the shares cancellation.
Added on 3 September 2021.
An issuer may only purchase shares by way of a market acquisition at a price which is not more than 5% above the average closing market price. For this purpose, the average closing market price is:—(1) the average of the closing market prices of the shares over the last 5 market days, on which transactions in the share were recorded, before the day on which the purchases are made; and(2) deemed to be adjusted for any corporate action that occurs during the relevant 5-day period and the day on which the purchases are made.
Off-Market Acquisition on an Equal Access Scheme
An issuer making an off-market acquisition in accordance with an equal access scheme must issue an offer document to all shareholders containing at least the following information:—(1) Terms and conditions of the offer;(2) Period and procedures for acceptances; and(3) Information in Rule 883 (2), (3), (4), (5) and (6)
886(1) An issuer must notify the Exchange of any share buy-back as follows:—(a) In the case of a market acquisition, by 9.00 am on the market day following the day on which it purchased shares,(b) In the case of an off market acquisition under an equal access scheme, by 9.00 am on the second market day after the close of acceptances of the offer.