A Bhd, a listed corporation has an issued and paid-up capital of RM100 million comprising of 100 million ordinary shares of RM1.00 each. Pursuant to its authorisation in year 2009, A Bhd had purchased 10 million of its own shares and retained the shares purchased as treasury shares. Can A Bhd still purchase its own shares in year 2010?
No, pursuant to paragraph 12.09 of the Main LR, A Bhd must not purchase its own shares or hold any of its own shares as treasury shares if this results in the aggregate of the shares purchased or held exceeding 10% of its issued and paid-up capital. Hence, as the treasury shares held by A Bhd in year 2010 is already 10% of its issued and paid-up capital, A Bhd may not purchase its own shares in year 2010. However, if the treasury shares are cancelled in year 2010 and subject to the authorisation from shareholders, A Bhd may purchase its own shares subsequently.