Habib Sugar Mills Limited (HABSM) has decided to buy back up to 15,000,000 ordinary shares through the bourse, it said in a notice to the Pakistan Stock Exchange (PSX) on Tuesday.

The company added that these shares, having a face value of Rs5 each, constitute up to 10% of the current issued and paid up share capital of the company.

“The Board of Directors (BoD) of Habib Sugar Mills Limited, in its meeting held on December 23 has approved and decided to recommend to the members of the company for their approval by passing of special resolutions, the purchase/ buy-back of up to 15,000,000 issued ordinary shares of the company (constituting 10% of the current issued ordinary share capital) of the face value of Rs5 each, by the company in accordance with Section 88 of the Act,” read the statement.

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HABSM said that the purpose of the purchase was the cancellation of shares, which shall be purchased from time to time at the spot/current price acceptable to the company prevailing during the purchase period.

The shares shall be purchased “from February 2, 2024, to July 30, 2024 (both days inclusive) or till such date that purchase is complete, whichever is earlier”.

HABSM shared that the purchase of shares shall be made out of the distributable profits as required under Section 88(8) of the Companies Act, 2017.

“The company will utilize its internally generated cash flows and ensure availability of funds for the purchase/buy-back of shares,” it said.

The BoD said that the proposed buy-back of shares will have a positive impact on the financial position of the company.

“This will also improve the Earning per Share (EPS) as well as break-up value of the company’s shares. Further, it will provide an opportunity of exit to those shareholders who wish to liquidate their investments,” read the statement.

Incorporated in Pakistan on February 08, 1962, Habib Sugar Mills Limited is engaged in the manufacturing and marketing of refined sugar, ethanol, liquified carbon dioxide, household textiles, providing bulk storage facilities and trading of commodities.