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Kirloskar Oil - Buy Back Offer

  • Enam Securities Pvt Ltd ("Manager to the Buyback") on behalf of Kirloskar Oil Engines Ltd ("Target Company") has informed this Public Announcement ("PA") to the Equity Shareholders / Beneficial Owners of the equity shares of the Target Company, pursuant to the provisions of Regulation 15 (d) read with Regulation 15 (c) and is in compliance with the Securities and Exchange Board of India (Buyback of Securities) Regulations, 1998 as amended thereto ("Buyback Regulations") and contains the disclosures as specified in Schedule II to the Buyback Regulations.

The Buy back:

  • The Board of Directors of the Target Company at its meeting held on January 25, 2012 ("Board Meeting") approved the proposal for buyback of its own fully paid up equity shares of Rs. 2 each ("Buyback") in accordance with the provisions contained in the Article 5A of the Articles of Association of the Company, Section 77A, 77AA, and 77B and other applicable provisions of the Companies Act, 1956 ("Act") and the provisions contained in the Buyback Regulations subject to other applicable laws, approval/s as may be necessary, from time to time from statutory authorities including but not limited to Securities and Exchange Board of India, stock exchanges, Reserve Bank of India etc. as may be required and further subject to such conditions as may be prescribed while granting such approval/s which may be agreed to by the Board of Directors (which term shall include Committee of Directors and Board or Committee as "the Board").
  • The Board has proposed a maximum limit of up to Rs. 73.625 Crores excluding brokerage costs, SEBI turnover charges, taxes such as securities transaction tax, service tax and relevant stamp duty ("Transaction Costs") for the Buyback ("Maximum Buyback Size"). The Maximum Buyback Size represents 10% of the aggregate of the Company''s called up and paid up equity share capital and free reserves as at March 31, 2011 (the date of the latest audited accounts as on the date of the Board Meeting).
  • The Board has proposed Buyback of Equity Shares at a maximum price not exceeding Rs. 170 per equity Share excluding Transaction Costs ("Maximum Buyback Price").
  • At the Maximum Buyback Price of Rs. 170 per equity share and for the Maximum Buyback Size not exceeding Rs. 73.625 Crores, the maximum number of equity shares that can be bought back would be 4,330,882 equity shares ("Maximum Offer Shares"), representing 2.97% of the pre-Buyback outstanding fully called-up and paid-up equity shares of the Company as on date of the Board approval for approving the Buyback on January 25, 2012. Should the average purchase price be lower than Maximum Buyback Price, the number of equity shares that might be bought back would be more, assuming Buyback for the complete amount of Rs. 73.625 Crores.
  • The maximum number of equity shares that the Company can buyback, as per Section 77A of the Act, in any financial year shall not exceed twenty-five percent of the total paid-up equity capital of the Company in that financial year. The Buyback of the Equity Shares would further be subject to the conditions for continuous listing prescribed in terms of Clause 40A of the Listing Agreement between the Company and the Stock Exchanges for maintaining a minimum public shareholding of 25% of the total paid-up share capital of the Company.
  • The Buyback is proposed to be implemented by the Company through the methodology of "Open market purchases through Stock Exchanges", as provided in the Buyback Regulations. The Buyback will be implemented in the manner and following the procedure prescribed in the Act and the Buyback Regulations and as may be determined by the Board and on such terms and conditions, as may be permitted by law from time to time. The Equity shares of the Company are listed on BSE Ltd ("BSE") and National Stock Exchange of India Ltd ("NSE") and the buyback of shares will be made through the above named stock exchanges with electronic trading facility.The Company proposes to buyback a minimum of 1,082,721 equity shares ("Minimum Offer Shares").

Proposed Time Table:

  • Board meeting approving Buyback - January 25, 2012
  • Date of Opening of Buyback - March 01, 2012
  • Acceptance of equity shares - Within 15 days of the relevant pay-out dates of the Stock Exchanges
  • Extinguishment of equity shares - Within 15 days of acceptance of equity shares as mentioned above provided the Company shall ensure that all equity shares bought back are extinguished within 7 days from the last date of completion of Buyback.
  • Last Date for the Buyback - January 24, 2013 (i.e. 12 months from the date of the resolution passed by the Board approving the Buyback or when the Company completes the Buyback to the extent of Rs. 73.625 Crores, whichever is earlier, or at such earlier date as may be determined by the Board, in the event the Minimum Offer Shares have been purchased under the Buyback, even if the Maximum Buyback Size has not been reached, by giving appropriate notice of such date and completing all formalities in this regard as per relevant laws and regulations.All payment obligations related to the Buyback shall be completed by the Last Date for the Buyback.

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