HUL shareholders approve share buyback

FMCG major Hindustan Unilever (HUL) today said that its shareholders have approved the buyback of 25 per cent of the company's equity share capital, aggregating to a figure of Rs 630 crore.

"The shareholders have approved the special resolution as embodied in the Postal Ballot Notice, dated June 11, 2010, for buyback of the equity shares of the company, with an overwhelming majority of 99.19 per cent votes," HUL said in statement.

The company said that while 1,31,68,72,659 votes were in favour of the buyback, 1,06,09,222 votes were against it.

On June 11, the company's board had approved the share buyback from the market at a price of Rs 280 per share.

The company had said that the buyback price is at a premium of 20 per cent over the average closing price of the company's shares in the last three months, entailing an outgo of Rs 630 crore.

"The buyback shall be implemented from open market purchases through the Bombay Stock Exchange and National Stock Exchange," the company said.

It had sought the approval of shareholders to buy back company shares up to 25 per cent of the paid capital.

According to the March quarter shareholding pattern data available with the National Stock Exchange, the promoters currently hold 52 per cent stake in HUL. The last time the company resorted to a buyback of shares was in July 2007.

The FMCG major's proposal is driven by a good show in the personal products segment, and a 47 per cent climb in profit to Rs 581.20 crore for the quarter ended March 31, 2010.

Net sales of the firm for the quarter stood at Rs 4,315.7 crore, compared to Rs 3,988.33 crore a year ago. It also declared a final dividend of Rs 3.50 per share for the fiscal ended March 2010.