Union Bank to open share repurchase offer on June 27
Union Bank recently announced to the Colombo Stock Exchange (CSE) that the bank has convened an Extraordinary General Meeting on June 11, 2019, to obtain the shareholder approval to carry out a repurchase of up to a maximum of 7,851,844 ordinary shares from its shareholders at the price of Rs.15 per share, amounting to a maximum distribution of Rs.117,777,660.
The bank expects to commence the offer to repurchase the shares as aforesaid on June 27, 2019 and close the said offer on July 11, 2019.
As per the applicable law, the said offer will be made to all shareholders of the bank, on a pro rata basis. Accordingly, the proportion in which the said repurchase offer will be made to the shareholders of the bank will be one ordinary share for every 139 ordinary shares held by each shareholder.
Where a shareholder does not accept the offer or accepts the offer only in part, the bank will repurchase additional shares from any shareholder who tenders shares over and above their pro-rata entitlement for repurchase by the bank (on a pro-rata basis) up to the aforesaid maximum number of shares that the bank intends to repurchase.
On May 8, 2019, the bank announced to the CSE that Culture Financial Holdings Limited, Alexis Indrajit Lovell and Vista Knowledge Pte Ltd, who together hold 853,033,616 shares of the bank, representing 78.16 percent of the issued shares in the bank, have informed the bank in writing that they would not accept the offer to repurchase their shares.
Accordingly, given that the shareholders identified above will not accept the offer and assuming all remaining shareholders accept the offer and in addition thereto, apply for additional shares over and above their entitlements, the bank will be in a position to distribute among the remaining shareholders, up to a maximum of Rs.117,777,660 by repurchasing from each remaining shareholder, the number of shares offered to be repurchased by the bank under the offer and any additional shares tendered by the said remaining shareholders, at the same consideration of Rs.15 per share, subject to the maximum number of shares the bank intends to purchase.