Feedback

Buybacks

I refer to my recent article ‘Buybacks revisited’ (11 May 2017 page 10) on multiple completion buybacks which followed on from my original article ‘Multiple attraction’ (13 October 2011 page 14).

A multiple completion buyback is a mechanism whereby a private company can buy back shares from a difficult or unwilling shareholder but with the payments being phased so the company can afford them. However because company law prohibits a company from paying for its shares in instalments as a third-party buyer could a multiple buyback is a mechanism for achieving the same economic result. The seller unconditionally disposes of his entire beneficial interest in the shares on the date of the contract and the shares are cancelled as and when the completion payments are made. HMRC still seems unwilling to give clearance for this type of buyback. Further it...