Caltex Australia Buys-Back 11.1 Million Shares, Via $260 Mn Off-Market Buyback

  • Apr 15, 2019 AEST
  • Team Kalkine
Caltex Australia Buys-Back 11.1 Million Shares, Via $260 Mn Off-Market Buyback

Caltex Australia Limited (ASX: CTX) is one of Australia’s leading fuel supplier, with around 2,000 company-owned sites. The company has been active in the business since 1900. It operates as a refiner, importer, and marketer of fuels and lubes.

The company today declared to the exchange that it has successfully completed its $260 million Buyback (off-market). CTX successfully bought back a total of 11.1 million shares, aggregating to 4.26 percent of the issued capital of the company. The size of the buyback stood at $260.2 million. The company bought back the shares at $23.43 resulting in a buyback discount of 14.0 percent. Of the $23.43 buyback price, $2.01 was the capital component of the buyback price, and $21.42 was the fully franked dividend component. The tax-market-value stood at $27.02.

The 11.1 million shares purchased by Caltex would be cancelled.

The company observed a strong demand for its buyback; hence, an 86.86 percent scale back of successful tenders was required. The scale back was designed to ensure the listed shareholders with small holdings were not disadvantaged. Apart from exclusions due to any lowest price conditions, shareholders who have submitted their shares at a fourteen percent discount as a final price tender would have a priority allocation of 185 shares bought back before the scale back is applied. Due to the scale back, 75 shares or less would be left with the shareholders.

Further, the company reported that those shareholders who submitted shares at a discount of 10-13 percent and tender conditional upon a minimum price above the buyback price; such shares were not bought back. Such shares would be released into the shareholders’ holdings by the close of business today, i.e. 15 April 2019.

CTX has requested the Australian Taxation Office to provide a Class Ruling in relation to the tax implication of the buyback. This ruling is expected to confirm that $21.42 per share of the buyback price would be treated as a fully franked dividend and for Australian capital gains tax purpose, the deemed capital proceeds would be $5.60 with a capital component of $2.01 plus $3.59 excess of the tax Market Value over the buyback price.  ATO has informed the company that class ruling with regard to the buyback would be possibly issued by the end of May 2019.

The company also informed the shareholders in its press release that the payments to bank accounts and dispatch of cheques for shares bought back would be completed by Tuesday, 23 April 2019.

CTX shares have delivered a decent return of 192.31 percent in the past decade. Further, the stock has delivered -5.11 percent, 4.38 percent, and 1.17 percent in the past six months, three months, and one-month respectively.

The shares of WHA are trading at $27.460 on ASX (As at 15 April 19, AEST 3:35 PM), down by 0.76 percent as compared to the previous day’s closing price. The market capitalisation of the company stands at $7.22 billion. The 52-week high price is $33.650, and the 52-week low price is $24.500. As per the lasted updated ASX data, the EPS stands at $2.149, current PE stands at 12.880x and a dividend yield is 4.26 percent.


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