Nalco to buy back shares worth Rs 2,835 crore

NEW DELHI: Aluminium maker Nalco today said its board has approved a proposal to buy back 64.43 crore shares worth close to Rs 2,835 crore, a move that will lead to liquidation of government's stake in the firm.

In a regulatory filing, the company said its board approved buyback of not exceeding 64,43,09,628 equity shares of the company (representing 25 per cent of the total number of equity shares in the paid-up share capital of the company).

The buyback will happen "at a price of Rs 44 per equity share payable in cash for an aggregate consideration not exceeding Rs 2834.96 crore," the filing said.

This should not exceed 25 per cent of aggregate of the fully paid-up share capital and free reserves as per audited accounts of the company for the fiscal ended March 31, 2015.

The Navratna firm will take the approval of shareholders by way of a special resolution through Postal Ballot and all other applicable statutory approvals, it added.

"The Board of Directors noted the intention of the Promoter (government) of the company to participate in the proposed Buyback," the filing said.

Earlier, sources had said that government was looking to raise around Rs 3,250 crore by selling 25 per cent stake to Nalco after its stake sale plans got derailed due to volatile markets. Government, which holds 80.93 per cent stake in Nalco, was planning to divest 10 per cent shareholding to raise about Rs 1,300 crore.

Earlier this month, Mines Secretary Balvinder Kumar told PTI that Finance Ministry asked it to allow Nalco to buy-back 25 per cent of governments' stake in the firm.

In anticipation of the buyback announcement, shares of the firm today rose by 1.65 per cent to settle at Rs 43.05 apiece on the BSE.