In this file photo a private security guard stands at the exit gate of the headquarters of Tata Consultancy Services (TCS) in Mumbai. (REUTERS/Shailesh Andrade)
New Delhi: Tata Consultancy Services on Wednesday said its promoters intend to participate in its proposed Rs 16,000-crore buyback offer.
Last month, the country’s largest software exporter had announced a Rs 16,000 crore share buyback offer — the biggest in the Indian capital market so far.
“In terms of the SEBI Buyback Regulations, under tender offer route, the promoters have the option to participate in the buyback. We would like to inform that the Promoter and Promoter Group of the company have communicated their intention to participate in the proposed buyback,” TCS said in a filing.
The buyback is subject to approval of the members by means of a special resolution through a postal ballot. The public announcement setting out the process, timelines and other requisite details will be released in due course in accordance with the SEBI Buyback Regulations, it said.
TCS had said its Board had approved buyback of up to 5.61 crore shares, or 2.85 per cent of its share capital, at Rs 2,850 apiece.
The share buyback, if successful, will be India’s biggest, surpassing Reliance Industries’ 2012 share repurchase of Rs 10,400 crore.
TCS has a cash pile of Rs 43,169 crore, which is nearly 10 per cent of the company’s market capitalisation.
Share buybacks typically improve earnings per share and return surplus cash to shareholders while also supporting share price during periods of sluggish market condition.