The Securities and Exchange Board of India (Sebi) has cleared the deck for a proposed share buyback in NTPC. The state-owned power generation company had approved the market regulator seeking an exemption from strict enforcement of buyback regulations –specifically 24(ii) of Sebi Buyback Regulations 2018.
Under this regulation, a company is barred from announcing a buyback during the pendency of any scheme of amalgamation.
Last year, the NTPC board had approved a scheme of amalgamation entailing the merger of Nabinagar Power Generating Company and Kanti Bijlee Utpadan Nigam with itself. Both the firms are wholly-owned subsidiaries of NTPC. The scheme of amalgamation is yet to be completed. As a result, NTPC is technically prohibited from announcing a buyback.
