The following Corporate guidance note provides comprehensive and up to date legal information covering:
A limited company may buy back shares in itself, if certain conditions set out in the Companies Act 2006 (CA 2006) are met. This is known as a share buyback or a purchase of own shares. In addition to the provisions of CA 2006, there are other rules and guidelines that are relevant to a listed company or an AIM company.
The restrictions in CA 2006 relating to share buybacks do not apply to unlimited companies. For further information on this type of company, see Practice Note: Unlimited companies.
For an introduction to share buybacks, see Practice Note: Share buybacks—a quick guide.
For a consideration of the law applicable to a share buyback and information on why a company might wish to carry out one, see Practice Note: Share buybacks—the legal framework.
A private limited company will only buy back its shares off-market. Therefore, this Practice Note does not deal with on-market share buybacks.
For an explanation of the differences between an off-market share buyback and an on-market share buyback, see Practice Note: Share buybacks—the legal framework.
For information on share buybacks by public limited companies, both off-market and on-market, see Practice Notes: Public company share buybacks—initial considerations, Public company share buybacks—financing, Public company share buybacks—procedure for approving a share buyback, Public company share buybacks—procedure for implementing a share buyback, The effect
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