Indiabulls Real Estate Ltd triggers Rs 500 crore buyback of shares.

On Friday, Indiabulls Real Estate Ltd (IBREL), announced a buyback of up to 5 crore shares per Rs 100 which could cost the company up to Rs 500 crore. The amount of the buyback is more than twice as high as the current BSE share price, which stands at Rs 43.40.

IBREL told in a regulatory filing that its board of directors approved a proposal to buy back Rs 500 crore of up to 5 crores fully paid-up equity shares representing approximately 11% of its current total paid-up capital of Rs 100 per share. The acquisition would be done by way of the tender, as stipulated by the SEBI market regulator.

All qualifying current equity holders (including those who become investors by cancelling Global Depository Receipts and acquiring the underlying equity shares) should participate proportionately. The Buyback Committee was formed by the Board and assigned powers to oversee and enforce the process.

According to the current shareholding, IBREL owns 23.36% of promoters, while the Embassy Group based in Bengaluru holds almost 14% of the shareholding.

Jitu Virwani CMD of the Embassy Group said on Thursday that the Group does not immediately plan to increase its IBREL stake.

Talking about the company’s plan to raise the stake in IBREL, Virwani stated PTI “That there is no plan right now.” He added that the company will continue to invest in IBREL.

As part of its strategic focus on financial services and the exit from real estate business, IBREL promoters sold 14% of its stakes to Embassy Group in June through open market transactions for Rs 950 crore. This offer has been intended to enter into Mumbai and Delhi-NCR markets, the two largest real estate markets in the country by an Embassy Group based in Bengaluru.