Heritage Foods has encountered a poor response to its offer to repurchase its shares from the open market. The offer opened 24 January and is due to close 28 March [tomorrow].
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The company had expected to repurchase up to 14 lakh (US$2.9bn) of shares from approximately 9,284 small shareholders. However, so far it has bought back just one lakh worth of shares.
It was intended that the scheme be kept alive until 14 lakh of shares had been repurchased, or until 3 January next year, but the poor response has prompted Heritage Foods to call the scheme off early.
It is believed that the poor response is, in part at least, due to small shareholders not understanding how the buyback worked. There was also some confusion over the price Heritage was willing to pay.
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