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Buyback of Shares & Open Offer of shares
A buyback of shares happens when a company decides to repurchase their shares from existing shareholders. It is a way to properly utilize their available cash when there are no other lucrative investment opportunities that could improve future earnings and profitability.
An open offer is an exit route given to existing shareholders through public notice. It happens in case of 3 events:
- If any of the promoters of a company want to increase their stake;
- If non-promoters increase their stake to 15%; or
- If the company is going to de-list from the stock exchange.
