Hungary Richter to buy large volume of own shares

Such commissions are not new at Richter. There have been many of such own share purchases over the last few years. Whereas the declared goal is to use the shares as incentives (bonus programme), the own shares may also serve the following objectives:

• Richter wants to pay with its own shares for a company it would take over. This would be a deal to boost confidence for it may choose to pay with cash, but in the former case the buyer would be incentivised even more to create value in the joint company.
• Richter may want to optimise its capital structure and boost shareholder value that way. It is possible that in a given moment Richter is unable to invest is accumulated funds to achieve a desired return therefore it may decide to create value for its shareholders in the form of dividend payment or via buying its own shares.
• Share price maintenance. Amidst extreme stock market circumstances it is not uncommon in the international practice to maintain the share price via own share purchases.

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