Advertisement
China’s BYD to spend US$55 million on buy-back of Shenzhen-listed shares as world’s largest EV maker eyes higher market value
- BYD will tap its own cash reserves to repurchase at least 1.48 million yuan-denominated A shares
- The Shenzhen-based company intends to spend no more than US$34.51 per share under its buy-back plan
Reading Time:2 minutes
Why you can trust SCMP
Daniel Renin Shanghai
BYD, the world’s largest electric vehicle (EV) maker, plans to buy back 400 million yuan (US$55.56 million) worth of its mainland-listed shares, with the aim of lifting the company’s stock price amid concerns about escalating competition in China.
Shenzhen-based BYD, backed by Warren Buffett’s Berkshire Hathaway, will tap its own cash reserves to repurchase at least 1.48 million yuan-denominated A shares, or about 0.05 per cent of its total, before cancelling them, according to the company’s announcement after the market close on Wednesday.
Advertisement
A buy-back and cancellation leads to a smaller volume of total shares in the market, which translates to a rise in earnings per share.
The proposed share repurchase seeks to “safeguard the interests of all shareholders, shore up investor confidence, and stabilise and enhance’ the company’s value, BYD said in a filing to the Hong Kong and Shenzhen stock exchanges.
BYD intends to spend no more than 270 yuan per share under its buy-back plan, which is subject to approval by the company’s shareholders. The share repurchase scheme is expected to be completed within 12 months of its approval.
Advertisement
Advertisement