Investigating certain share buyback transactions by companies listed on the JSE for the period 2000 to 2005

ENGLISH ABSTRACT: Prior to 30 June 1999 companies in South Africa were not allowed to buy back their own shares. Amendments to the Companies Act, the Companies Amendment Act (Act 37 of 1999) radically changed the philosophy around capital maintenance. The result of this amendment is that a company is allowed to buy back its own shares and finance the backbuying of its shares under certain circumstances. A sample of 140 companies listed on the Johannesburg Securities Exchange for the period 2000 to 2005 was selected. The backbuying of shares by the relevant company, subsidiary and trust was analysed for the period 2000 to 2005. For the purposes of this empirical study, the financial sector, as well as the alternative exchange, that is focussed on good quality small and medium-sized high growth companies, were excluded during sample selection. The outcome of this exploratory study is the identification of the fact that a share buyback took place or not in Tables 4.1 and 4.2; a summary of the number of shares bought back in Table 4.3; and, in Table 4.4, a summary of the number of shares bought back, expressed as a percentage of the weighted average number of shares in issue.