Buy Back Of Preference Shares
Rakhi Baid (1 Points)
01 September 2018
Can Preference Shares be bought back before maturity ? can it be termed as buy back of Preference Shares ?
2 Replies
Santhosh Gundinahole
(Studnet)
(347 Points)
Replied 01 September 2018
Buy Back Concept will not apply to preference shares. If you want redeem preference shares before maturity period, that will be known as redemption of preference shares only.
Sec 55(2) says
The company redeems preference shares as per terms of issue or as varied u/s 48, it may be redeemed at a fixed time or on happening of an particular event, at any time at the option of the company or Shareholders.
So out of above content it is clear that redemption of preference shares can be done at the option of company. Hence it can redeem preference shares before it's maturity.
Sec 55(2) says
The company redeems preference shares as per terms of issue or as varied u/s 48, it may be redeemed at a fixed time or on happening of an particular event, at any time at the option of the company or Shareholders.
So out of above content it is clear that redemption of preference shares can be done at the option of company. Hence it can redeem preference shares before it's maturity.
gopal
(future smart stupid)
(293 Points)
Replied 01 September 2018
but only if articles and contract terms permit otherwise also possible but have to take consent ...
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