Abbey housebuilders to buy back shares

HOUSEBUILDER Abbey is to seek shareholder approval to buy back up to 15% of its shares.

The company is calling an EGM of shareholders next month to seek the authority.

Abbey said it would only buy back its own shares “when appropriate financial and stock market conditions prevail and when the board determine that share repurchases are in the interests of the company and its shareholders”.

The company said had the authority been in place it would have exercised the option in September when “volatile” market conditions wiped 26% off its share price.

“A share buy back programme would also provide shareholders with the flexibility, but without any compulsion, to realise value in respect of shareholdings and is a tax efficient method of returning surplus cash to shareholders,” the company said in a statement.

The firm is seeking approval to buy back up to 14.99% of its shares, which could return up to €31.6m to shareholders.

At its annual general meeting earlier this month Abbey said turnover in the current financial year was running ahead of 2006 but the Irish housing market has slowed down.

Abbey shares hit an all-time high of €12.10 in February this year but have fallen back since and closed yesterday at €7.08.