Eros International Media 's board on Monday announced a share repurchase programme worth up to $20 million (about ₹138.86 crore) on the NYSE. However, the move failed to arrest further slide in the company’s stock price.

The announcement comes in the backdrop of downgrading of the long-term and short-term bank facilities of the company by CARE Ratings.

The rating agency said the revision in the ratings assigned to the bank facilities of Eros International Media, a step-down subsidiary of Eros International Plc, is on account of ongoing delays/ default in debt servicing due to slowdown in collection from debtors, leading to cash flow issues in the company.

“The Eros board of directors believes the equity value of Eros International is seriously undervalued in the public markets; and accordingly, the board has approved a share buyback programme of up to $20 million of outstanding common shares,” Eros International Media said in a BSE filing.

“We now have a strong financial and operating position and our management team are making it a priority to work with CARE Ratings — the regulatory agency, to have our credit rating revised upwards in due course,” Eros International Group Chairman and CEO Kishore Lulla said. Regarding the share repurchase announcement, the company said it “may be made at the management’s discretion from time to time in the open market or through privately negotiated transactions.

“The repurchase programme has no time limit and may be suspended for periods or discontinued at any time. Eros’ share repurchase programme does not obligate it to repurchase any specific number of shares and may be suspended or discontinued at any time.” Shares of Eros International Media on Monday fell 9.9 per cent on the BSE to hit a 52-week low and the lower circuit of ₹40.95 apiece.

The company’s shares had plummeted 15 per cent on Friday on the BSE.

 

Related Topics
comment COMMENT NOW