AZB & Partners has advised Larsen & Toubro (L&T) on the buyback of USD1.2 billion worth of equity from shareholders and beneficial owners.
Partner Lionel D’Almeida and senior associate Sweta Ananthanarayanan worked on the deal.
In the buyback process, qualified institutional buyers represented more than 86% of the total number of subscriptions, while non-institutional investors accounted for less than 1% of the bids. Individual investors, on the other hand, comprised 12.4% of the total bids.
In late September, prior to the settlement of L&T’s share buyback bid, the company’s shares surged by 2%, reaching an unprecedented peak of INR3,013 (USD36) each on the BSE.
L&T, a prominent entity in the corporate landscape, formally announced a buyback offer under the Securities and Exchange Board of India (Buy-Back of Securities) Regulations, 2018. The company intended to buy back fully paid-up shares with a face value of INR2 each, representing 2.22% of the total amount of stockin the paid-up equity share capital of the company. This buyback offer was extended to shareholders and beneficial owners of equity shares as of 12 September, 2023.
The buyback was carried out on a proportionate basis, using the tender offer route through the stock exchange mechanism. The offer price for each share was finalised at INR3,200 that was payable in cash. The aggregate consideration for this buyback initiative was set at a maximum of INR100 billion, representing 14.06% and 11.97% of the fully paid-up equity share capital and free reserves.
L&T’s buyback offer represented a significant financial transaction, which was aimed at improving shareholder value and providing an opportunity for eligible stakeholders to participate in the tender offer.