Sebi allows Thomas Cook India to withdraw Rs 150 crore share buyback offer

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Sebi allows Thomas Cook India to withdraw Rs 150 crore share buyback offer


MUMBAI: Securities market regulator Sebi has allowed Thomas Cook (India) to withdraw its Rs 150-crore share repurchase offer after the travel services provider expressed tight financial position due to Covid-19. Sebi, while granting an exemption to Thomas Cook, said that this should not be taken as a precedent, indicating that listed companies that announced a share buyback offer will not be allowed to withdraw.

In February 2020, Thomas Cook’s board had approved a proposal to repurchase upto 6.9% stake for Rs 150 crore. But after that, the company’s financial position deteriorated substantially because of the business pressures arising from Covid-19. The company, while requesting Sebi to allow it to withdraw the offer, said that its present position is not what it was when it announced the share buyback. The travel and hospitality sector has been the hardest hit by the coronavirus outbreak.

The regulator on Thursday said that if Thomas Cook is compelled to perform its share buyback programme, then it will have an adverse effect on its business and in turn, its shareholders. So, it is treating this as a unique case and is allowing Thomas Cook’s request for withdrawal. Thomas Cook is owned by Canadian-Indian investor Prem Watsa.





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