A day before the crucial Reliance Industries board meeting, Reliance Energy Ltd on Sunday announced that it has extended its buyback programme up to March 17, 2005.
All other terms of the buyback remain unchanged: The maximum price of the buyback remains at Rs 525 a share and the maximum fund to be used remains at Rs 350 crore (Rs 3.50 billion).
REL said the buyback was initially supposed to last till September 17. This was later extended to December 17 and now has been extended again by another 90 days. Describing it as "one of the largest buyback announced in recent times," the company said that the scheme will continue till March 17, 2005.
According to media release, the company decided that no buyback will be affected at this stage as the recent fall in share price is owing to "extraordinary events and developments related to the Reliance group reported widely in the media."
The company has also decided that the terms of the buyback will remain unchanged and will be reviewed from time to time. "In implementing the share buyback, the company will not take any steps that will allow speculators to gain advantage during the current period of extraordinary events related to the group," the release added.
"The driving philosophy of the buyback is to: reduce volatility of the company's stock price; deter speculative activity in the company's stock; positively impact on the company's stock price, contributing to the maximisation of shareholder value; send strong signal to the markets on the undervaluation of the company's stock price; reiterate confidence of the management in future prospects," the release said.
The share price of REL has closed below the buyback price for eight trading days of the 140 trading days since it was originally announced in June, 2004.
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