Infosys Technologies

#82
I see in public notic that Infosys will send a letter indicating no. of shares entitled for participation in buyback. It seems you can tender more or less than this entitlement.

I could not understand what does "no. of shares entitled" means

- Does it mean if I tender less than or equal to this quantity, all my shares will be accepted.

- If I tender more than my entitlement what would be the criteria for buyback. I mean to say if say someone tendering full holding and for his the acceptance ratio is 50%. If I tender 120 out of 200 of my holding, In that case would they accept 50% of 200 or 50% of 120
 
#83
I see in public notic that Infosys will send a letter indicating no. of shares entitled for participation in buyback. It seems you can tender more or less than this entitlement

I could not understand what does "no. of shares entitled" means
- Does it mean if I tender less than or equal to this quantity, all my shares will be accepted.

- If I tender more than my entitlement what would be the criteria for buyback. I mean to say if say someone tendering full holding and for his the acceptance ratio is 50%. If I tender 120 out of 200 of my holding, In that case would they accept 50% of 200 or 50% of 120
If participating in Retail, No. of shares entitled means, total number of shares of hold on the record date.
Ex: If you hold 100 shares on Record date, you are entitled to tender only 100.

In case the acceptance ratio is 35% (Which is most probably further go down), your 35 shares will be accepted and rest will be given back.

So If you are entitled for 100, and tender only 50, then total shares accepted will be 17.

Other scenario, if you bought further 100 after record date and tender 200 shares, they will only count the 100 shares which you are entitled to tender and proceed accordingly.

I hope it clears your doubt.
 

Alchemist

Administrator
Staff member
#84
I will be buying a few shares today.

I am not sure if I will get the shares in my account before the record date if I buy on Monday.

The ex-date is Tuesday.
 

Alchemist

Administrator
Staff member
#85
Anyone who wants to play the buyback arbitrage game should buy the shares today.

Don't wait till Monday. You may not get the shares in time if you buy on Monday.
 
#87
If participating in Retail, No. of shares entitled means, total number of shares of hold on the record date.
Ex: If you hold 100 shares on Record date, you are entitled to tender only 100.

In case the acceptance ratio is 35% (Which is most probably further go down), your 35 shares will be accepted and rest will be given back.

So If you are entitled for 100, and tender only 50, then total shares accepted will be 17.

Other scenario, if you bought further 100 after record date and tender 200 shares, they will only count the 100 shares which you are entitled to tender and proceed accordingly.

I hope it clears your doubt.
I may be wrong, but it does not appear correct to me.

From this the entitlement is not exactly the no. of shares held on record date. It would be less than that.

Based on the holding of Equity Shares as on the Record Date, the Company will determine the entitlement of each Eligible Shareholder, including Small Shareholders, to tender their Equity Shares in the Buyback. This entitlement for each Eligible Shareholder will be calculated based on the number of Equity Shares held by the respective Eligible Shareholder as on the Record Date and the ratio of Buyback applicable in the category to which such Eligible Shareholder belongs. The final number of Equity Shares that the Company shall purchase from Eligible Shareholders will be based on the total number of Equity Shares tendered. Accordingly, the Company may not purchase all of the Equity Shares tendered by the Eligible Shareholders.
From this, it seems the no. of shares accepted can be more than entitlement.

After accepting the Equity Shares tendered on the basis of entitlement, the Equity Shares left to be bought back, if any, in one category shall first be accepted, in proportion to the Equity Shares tendered over and above their entitlement in the offer by Eligible Shareholders in that category, and thereafter from Eligible Shareholders who have tendered over and above their entitlement in the other category.
Source : http://www.bseindia.com/xml-data/corpfiling/AttachHis/b6918a2b-cc86-4248-98e5-15f042c67be0.pdf
 

Alchemist

Administrator
Staff member
#88
Does it mean if I tender less than or equal to this quantity, all my shares will be accepted?
Entitlement is the minimum number of shares that the company will buyback from each shareholder.

If the number of shares that you tender is equal to or less than your entitlement, then 100% of your shares will be accepted.

The entitlement number for each investor will be very very small compared to the number of shares held by him/her and therefore for practical purposes, it is meaningless.

If you tender more than the entitlement, then the acceptance ratio will depend on how many shares are tendered in aggregate.

For the extra shares tendered (above entitlement), the buyback acceptance ratio will depend on how many shares are tendered in total and it will be proportional to the number of shares tendered by each individual.

The final acceptance ratio will not depend on entitlements but on number of shares tendered.

If A's entitlement is 5 and he tenders 15 and B's entitlement is 1 and he tenders 20, B will have more shares accepted even if his entitlement is lower than that of A.

Therefore it is very important to tender all shares. More shares you tender, more will be accepted.
 

Alchemist

Administrator
Staff member
#89
Another important point:

The maximum tender under the Buyback by any Shareholder cannot exceed the number of Equity Shares held by the Shareholder as on the Record Date.
 
#90
Entitlement is the minimum number of shares that the company will buyback from each shareholder.

If the number of shares that you tender is equal to or less than your entitlement, then 100% of your shares will be accepted.

The entitlement number for each investor will be very very small compared to the number of shares held by him/her and therefore for practical purposes, it is meaningless.

If you tender more than the entitlement, then the acceptance ratio will depend on how many shares are tendered in aggregate.

For the extra shares tendered (above entitlement), the buyback acceptance ratio will depend on how many shares are tendered in total and it will be proportional to the number of shares tendered by each individual.

The final acceptance ratio will not depend on entitlements but on number of shares tendered.

If A's entitlement is 5 and he tenders 15 and B's entitlement is 1 and he tenders 20, B will have more shares accepted even if his entitlement is lower than that of A.

Therefore it is very important to tender all shares. More shares you tender, more will be accepted.
Thanks Alchemist. I think I understood the concept and present it here. Please correct me if I am wrong.

Assuming the total no. of shares reserved for retail category : 25 lakhs( Actual figure is quite different but for simplicity I am assuming 25 lakhs)
Assuming the total no. of shares held by retail category on record date : 1 crore
Entitlement % = 25 lakhs/ 1 crore * 100 = 25%

Assuming the only 40 lakh shares are tendered out of 1 crore and 15 lakhs shares are tendered out of entitled 25 lakhs shares (as some people may not tender any shares or lower than their entitlement).

- I assume here first 15 lakh entitled shared would be accepted
- Then 10 lakhs would be accepted from remaining (40-15) 25 lakh shares which is 40%

If I am holding 200 shares and tender all 200 shares my entitlement is 50 and from remaining 150 shares over entitlement, 60 shares would be accepted. So total accepted shares is 110

If I am holding 200 shares and tender 50 all shares would be accepted

If I am holding 200 shares and tender 100 then 70 shares would be accepted

If I am holding 120 shares and tender 120 then 66 shares would be accepted

If I am holding 160 shares and tender 160 then 88 shares would be accepted
 

Alchemist

Administrator
Staff member
#91
Thanks Alchemist. I think I understood the concept and present it here. Please correct me if I am wrong.
You are correct.

Here is the process as stated in the draft offer document:

(a) Full acceptance of Equity Shares from Small Shareholders in the Reserved Category who have validly tendered their Equity Shares, to the extent of their Buyback Entitlement, or the number of Equity Shares tendered by them, whichever is less.
(b) After the acceptance as described in paragraph 23.8(a), if there are any Equity Shares left to be bought back in the Reserved Category, the Small Shareholders who were entitled to tender zero Equity Shares (on account of ignoring the fractional entitlement), and have tendered additional Equity Shares, shall be given preference and one Equity Share each from the additional Equity Shares tendered by these Small Shareholders shall be bought back in the Reserved Category.
(c) After the acceptance as described in paragraph 23.8(a) and (b), if there are any validly tendered unaccepted Equity Shares in the Reserved Category (“Reserved Category Additional Shares”) and Equity Shares left to be bought back in Reserved Category, the Reserved Category Additional Shares shall be accepted in a proportionate manner and the acceptances shall be made in accordance with the Buyback Regulations, i.e., valid acceptances per Shareholder shall be equal to the Reserved Category Additional Shares by the Shareholder divided by the total Reserved Category Additional Shares and multiplied by the total number of Equity Shares remaining to be bought back in the Reserved Category.
 
#92
Thanks Alchemist. I think I understood the concept and present it here. Please correct me if I am wrong.

Assuming the total no. of shares reserved for retail category : 25 lakhs( Actual figure is quite different but for simplicity I am assuming 25 lakhs)
Assuming the total no. of shares held by retail category on record date : 1 crore
Entitlement % = 25 lakhs/ 1 crore * 100 = 25%

Assuming the only 40 lakh shares are tendered out of 1 crore and 15 lakhs shares are tendered out of entitled 25 lakhs shares (as some people may not tender any shares or lower than their entitlement).

- I assume here first 15 lakh entitled shared would be accepted
- Then 10 lakhs would be accepted from remaining (40-15) 25 lakh shares which is 40%

If I am holding 200 shares and tender all 200 shares my entitlement is 50 and from remaining 150 shares over entitlement, 60 shares would be accepted. So total accepted shares is 110

If I am holding 200 shares and tender 50 all shares would be accepted

If I am holding 200 shares and tender 100 then 70 shares would be accepted

If I am holding 120 shares and tender 120 then 66 shares would be accepted

If I am holding 160 shares and tender 160 then 88 shares would be accepted
Thanks to both of you (Alchemist and Rajivka) for clearing the concept. My understanding was not right.

Now the scenarios are, if you have 200 shares, even though the total acceptance would be 62.5%, the actual acceptance will be even less than this.
Please correct me if I am wrong here.
 
#93
If I am holding 200 shares on record date, sold 100 shares after that and then bought back 100 shares, I assume I can still tender 200 shares. Please correct me if I am wrong.
 

Alchemist

Administrator
Staff member
#96
Any update on Infosys buy back? I have not received any email so far. Is it expected to take some time or I missed the email?
When did you purchase the shares?

I think the company is yet to send the offer document to shareholders. I haven't received any communication from company too.
 

Alchemist

Administrator
Staff member
The buyback will open on November 30.

Information technology (IT) bellwether Infosys on Friday said its share buyback offer would begin on November 30 and close on December 14.

The IT services major issued the letter of offer for the same. It said the letter along with the necessary forms would be dispatched to the eligible shareholders who appeared on the record date of November 1.
Infosys buyback to begin on November 30 | Business Standard News
 
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