Surge in share buyback volume

SHARE buybacks went up a gear last week with Noble Group and Genting Singapore both active in the market, the Singapore Exchange said yesterday.

It noted that 103.1 million shares were repurchased by 18 stocks for a total outlay of $80 million, well up on the same period last year when only 8.3 million shares were repurchased for $21.4 million.

Companies typically conduct buybacks to reduce the number of shares on the market to sustain or drive up their share value. They are carried out either to reward shareholders or to bolster falling stock prices. The three biggest movers last week were Noble Group, Genting Singapore and Keppel Corporation.

Commodity blue chip Noble bought back 77,714,200 shares for $54.51 million. It carried out another buyback yesterday - its fifth round this month - of three million shares for $2.1 million.

Noble has been aggressively buying back shares amid intense pressure from short-sellers, who have driven down the price by 40 per cent this year amid criticism over the firm's accounting and valuations.

The stock closed down 1.5 cents at 68.5 cents yesterday.

Genting Singapore bought back 16,511,700 shares last week for $15 million. The gaming firm, whose integrated resort here has been affected by the decline in VIP volume, passed a resolution at its last annual general meeting on April 21 to allow the buyback of up to 1.2 billion shares.

But the buybacks irked some shareholders at the AGM, with concerns raised about whether the massive amount to be spent on the programme was justified given the firm's low dividend payout of one cent per share.

KepCorp was active as well last week, buying back 200,000 shares for $1.69 million.

Singapore Technologies Engineering also moved, snapping up 500,000 shares for $1.64 million.

Others on the top 10 list of most active companies in share buyback last week included Pacific Century Regional Developments, Singapore Airlines and Hyflux.

A version of this article appeared in the print edition of The Straits Times on June 23, 2015, with the headline 'Surge in share buyback volume'. Subscribe