Market Regulator SEBI has declared new rules for the buy back. In the new rules the company has to repurchase minimum 50% of their offers. The companies have to complete the buy back in 6 months instead of the 12 months. Those not able to meet the target will be barred from launching new offers for a period of one year. Under the new norms the companies are required to keep 25% of the proposed offer in escrow account so as to check the non serious offers by the companies. These changes in the rules are meant to safeguard the interest of investors because some companies declare buyback in order to raise the prices of the stock.
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