Commonwealth Bank of Australia (CBA) will reclaim 3.8 per cent of its issued share capital following a successful buyback worth $6 billion.
The transaction will see CBA buy back approximately 67.7 million shares at $88.62 and then cancel them. The price includes a capital component worth $21.66 and a fully franked divided of $66.96.
The buyback was oversubscribed, forcing the bank to scale back investors by 79.4 per cent.
“Due to the strong demand for the buyback, a scale back of applications was required. In line with the terms of the buyback booklet, the scale back was structured to minimise disadvantaging shareholders with a small number of shares,” the CBA said in an ASX listing on Monday morning.
“Eligible shareholders who offered to sell their Shares at a 14 per cent discount or as a final price application, had a priority allocation of 100 shares (or lesser number) bought back before any scale back was applied. Applications for more than the priority allocation were accepted but scaled back by 79.4 per cent on a pro-rata basis.”
CBA confirmed that applications at discounts of 10-13 per cent and applications conditional upon a minimum price above the buyback price were not bought back. Shares that were offered but not bought back are expected to be released into shareholders’ holdings by Tuesday, 5 October 2021.
Payments for shares will commence on Friday.
