Online trading company, Plus500 Ltd, has announced the expansion of its share buyback program. The company’s Board of Directors approved the continuation, announcing that it plans to buy an additional $12.6 million of the firm’s share capital. This is coming after Plus500 acquired $12.6 million of the firm’s issued share capital on October 27.

The Repurchased Share Will Not Have

According to the announcement, the share purchases will be carried out in open market transactions and will be executed from time to time. However, the actual execution will depend on trading volume, share price, market condition, and other indices.

In preparation for the takeoff of the new program, Plus500 has appointed Liberum Capital Limited to manage the program.

The company will be charged with the responsibility of managing and purchasing the buyback share on behalf of Plus500. The repurchase action will be at the sole discretion of Liberum within the terms of the program. This means that Plus500 has no right to make any changes to the program.

Plus500 stated that the Board decided to extend the buyback program because of the high prospects and expansive financial position of the group. The company says the broad financial position is reflected in its 2021 trading update, released earlier this week.

Repurchased Shares To Be Classified As Treasury Shares

The repurchased ordinary shares by the company will be classified as dormant shares (shares held in treasury). These types of shares will not have voting rights and will not be entitled to dividends, unlike the ordinary shares held by shareholders.

The company revealed that the share buyback program will run until February 28, 2022. Plus500 aims to announce its preliminary results for the 12 months ending on December 31, 2021.

The London-listed forex and CFDs broker has been running share buyback programs for some time now. Last year, the firm repurchased about $88 million worth of its ordinary shares from the open market. Earlier this year, it went to the open market again and bought back $25 million worth of its shares.

The Latest Move Has No Impact On The Price

One of the goals of the buyback program is to try and raise investor optimism for the shares. However, Plus500’s latest move didn’t yield many results. Instead, the price of its shares fell by 1.22% shortly after the company announced the buyback program.

But despite the slight fall in its share price, the company’s financials remained more sold than the pre-pandemic levels.

The broker is also expecting an improvement in its revenue for the year compared to the forecasted levels.