Thomas Cook India receives SEBI approval for withdrawal of Buyback offer
Thomas Cook India receives SEBI approval for withdrawal of Buyback offer
Thomas Cook India today said that it has received the Securities and Exchange Board of India's (SEBI's) approval to withdraw its Rs 150 crore buyback Offer application filed vide the Draft Letter of Offer dated March 5, 2020.
Thomas Cook India Limited (TCIL)in its release said, "the Securities and Exchange Board of India (SEBI), vide its order dated February 11, 2021, has allowed the withdrawal of Thomas Cook India's Buyback Offer application filed vide the Draft Letter of Offer dated March 5, 2020." It added, "The application for withdrawal dated September 28, 2020, filed by Thomas Cook India (TCIL) has accordingly been disposed of under the relevant regulations of the SEBI (Buyback of Securities) Regulations, 2018."
In February 2020, Thomas Cook's board had approved a proposal to repurchase up to 6.9 per cent stake for Rs 150 crore. Meanwhile, the company's financial position deteriorated substantially due to the impact of the COVID-19 pandemic that hit India in March leading to enforcement of lockdown. The lockdown created business pressures and the company in its request to SEBI asked it to allow to withdraw the offer. In its request, the company said, currently, it is not in a position in which it was when the buyback was announced. The outbreak of the COVID-19 pandemic hit the travel and hospitality the hardest.
The Board of Directors of TCIL had approved the Buyback Offer in a meeting held on February 26, 2020, and filed the Draft Letter of Offer with SEBI vide a letter dated March 6, 2020. Subsequently, vide a letter dated September 28, 2020, TCIL had filed the application seeking withdrawal of the Buyback Offer.
The SEBI Order noted that the continuation of the Buyback Offer will result in an adverse effect on the business of the Company and turn, its shareholders. Accordingly, SEBI exercised its powers to allow the withdrawal of the Buyback.
Thomas Cook India said, the company will proceed to complete the regulatory formalities in this regard.