State-owned power giant NTPC board on Monday approved the buy back of 197.8 million equity shares for Rs 2,275.74 crore.
"The board of directors of the company in a meeting held on November 2, 2020 has inter-alia approved... buyback of the fully paid up equity shares of the company of face value of Rs 10 each," NTPC said in a BSE filing.
The board approved the proposal to buy back 19,78,91,146 fully paid-up equity shares at a price of Rs 115 per unit for an aggregate consideration not exceeding Rs 2,275.75 crore, the filing said.
The company has fixed November 13, 2020 as the record date for the purpose of ascertaining the eligibility of shareholders for buyback of equity shares.
Last month, markets regulator Sebi had granted exemption to NTPC from certain buyback norms for the proposed merger of its wholly-owned subsidiaries with the parent company.
In October, NTPC had filed an application with Sebi to seek exemption from the strict enforcement of the buyback norms.
The application had been necessitated on account of a scheme of amalgamation providing for the merger of NTPC's wholly-owned subsidiaries with itself.
In November 2019, NTPC's board of directors approved a scheme of amalgamation entailing the merger of Nabinagar Power Generating Company Ltd and Kanti Bijlee Utpadan Nigam Ltd with NTPC.
For this, the company proposed to explore the possibility of buying back its equity shares from the existing shareholders on a proportionate basis through the tender offer route, subject to the requisite approval.
Sebi had considered NTPC's application and noted that the proposed buyback, as per NTPC, will be in the interests of investors as the shareholders of the company will benefit from return of surplus cash through the buyback programme.