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Business · Markets
Midea Group completes largest ever share buyback
2019/01/02 08:36:59
China's News, China's Financial News, Midea buyback

Jan 02, 2019 (China Knowledge) - Home appliance maker, Midea Group has just completed the largest share buyback China’s domestic A-share market has seen so far.

Starting from July last year, the company had bought back 95.1 million shares for about RMB 4 billion in total, representing about 1.4% of the company’s total shares. The shares were purchased at a price range of between RMB 36.5 and RMB 48.4 each.

The buyback plan has hit the maximum amount allowed in the market and Midea will be cancelling the share bought back, bringing its share capital down to 6.6 billion shares from 6.7 billion.

Midea Group which is listed on the Shenzhen stock exchange commenced the buyback plan after it saw its shares lose almost 25% in value within a month when its share price fell to around RMB 45 per share.

Last year, falling share prices sparked a nation-wide share buyback frenzy as companies started to worry falling share prices would lead to margin calls for loans with shares pledged as collateral to them. This concern was also not lost on the government with many local governments setting up bailout funds to aid companies faced with such pledge-risks.

Midea Group’s share price currently trades at RMB 36.63 per share, starting the year slightly lower.

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