Off-market buybacks in Australia

September 7, 2019

This list tracks the outcomes of off-market buybacks in the Australian market.

Woolworths, 2019: $1.7 billion buyback which was 85% scaled back but gave everyone a priority allocation worth $5209. Final discount was 14% and the dividend component was $24.15 with the buy back price $28.94. See results announcement. Have emailed company seeking more detail on investor participation.

Caltex, 2019: $260 million buyback which was also 85% scaled back like Woolworths. Final discount was 14% to the market price $27.24 and the dividend component was $21.42 against a buyback price of $23.43. The tax market value was $27.02. See final announcement.

BHP, 2018: $7.3 billion buyback at a 14% discount of $27.64 - the scale back was 58.7% and investors were given a guaranteed 165 shares worth $4560 and anyone with less than 65 shares left were taken out completely. See announcement.

Rio Tinto, 2018: $2.71 billion buyback for Australian shareholders at a 14% discount to market with a 58.3% scale back. See final announcement. See this summary by Paul Rickard from The Switzer Report.

Rio Tinto, 2017: $700m buyback expanded to $750m due to strong demand. Final price a 14% discount to market and a huge 89% scale back applied, suggesting offers worth about $7 billion were received. See final announcement.

Telstra, 2016: $1.25 billion buyback with an 86% scale back. See final announcement. The $1.5 billion Telstra off-market buyback sparked this call by the Institute of Public Accountants for these schemes to be shut down. Telstra gave a priority allocation of 880 shares and accepted the lot if this would leave a shareholder with less than 350 shares. The shares have subsequently weakened so participants have done well receiving $4.43 for their shares when the stock is at around $3.50 in May 2019.

This is a good discussion on buybacks.