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BoN approves Capricorn share buyback


LISTED financial services group Capricorn Group Limited has received approval from the Bank of Namibia to go ahead with a share buyback programme.

A resolution to this effect was passed at the company’s last annual general meeting in October, and could see some shareholders get favourable returns on their investments in 2023.

Listed in 2013 at N$8,75, the company’s share price has grown over the years, reaching an N$18 peak in 2018.This Wednesday, shares were trading at N$13,02.

Share buying occurs when a company has excess cash and foresees that the stock market is on an upswing, and would want to retain as much value as possible with the company.

The company yesterday announced that although the central bank has given it the green light, there’s still one last stop to be made at the Business and Intellectual Property Authority (Bipa) for registration.

The buyback is to occur within 15 months of approval, and by the end of 2023, the banking services dominated group would be expected to have a different shareholding picture.

The company indicated that the repurchase price will not be more than 10% above the weighted average market price of the shares traded over the last five business days from when the transaction is effected.

The group has over 3 900 shareholders, with notable shareholders being Capricorn Investment Holdings (44,4%), the Government Institutions Pension Fund (26,8%), and Nam-Mic Financial Services Holdings (10%).

Towards the end of 2020, the Bank of Namibia issued a recommendation to commercial banks to restrict payouts of dividends, share dividends, and to even engage in share buybacks to preserve capital as Covid-19 ravaged economic activities.

With the approval, it appears this recommendation is no longer effective.

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