| (1) |
This section does not apply to— |
| (a) |
the making of a demand, tendering of shares and payment by a company to a shareholder in terms of a shareholder’s appraisal rights set out in section 164 ; or |
| (b) |
the redemption by the company of any redeemable securities in accordance with the terms and conditions of those securities. |
| (2) |
Subject to subsections (3) and (8), and if the decision to do so satisfies the requirements of section 46— |
| (a) |
the board of a company may determine that the company will acquire a number of its own shares; and |
| (b) |
the board of a subsidiary company may determine that it will acquire shares of its holding company, but— |
| (i) |
not more than 10%, in aggregate, of the number of issued shares of any class of shares of a company may be held by, or for the benefit of, all of the subsidiaries of that company, taken together; and |
| (ii) |
no voting rights attached to those shares may be exercised while the shares are held by the subsidiary, and it remains a subsidiary of the company whose shares it holds. |
| (3) |
Despite any provision of any law, agreement, order or the Memorandum of Incorporation of a company, the company may not acquire its own shares, and a subsidiary of a company may not acquire shares of that company, if, as a result of that acquisition, there would no longer be any shares of the company in issue other than— |
| (a) |
shares held by one or more subsidiaries of the company; or |
| (b) |
convertible or redeemable shares. |
| (4) |
An agreement with a company providing for the acquisition by the company of shares issued by it is enforceable against the company, subject to subsections (2) and (3). |
| (5) |
If a company alleges that, as a result of the operation of subsection (2) or (3), it is unable to fulfil its obligations in terms of an agreement contemplated in subsection (4)— |
| (a) |
the company must apply to a court for an order in terms of paragraph (c); |
| (b) |
the company has the burden of proving that fulfilment of its obligations would put it in breach of subsections (2) or (3); and |
| (c) |
if the court is satisfied that the company is prevented from fulfilling its obligations pursuant to the agreement, the court may make an order that— |
| (i) |
is just and equitable, having regard to the financial circumstances of the company; and |
| (ii) |
ensures that the person to whom the company is required to make a payment in terms of the agreement is paid at the earliest possible date compatible with the company satisfying its other financial obligations as they fall due and payable. |
| (6) |
If a company acquires any shares contrary to section 46, or this section, the company must, not more than two years after the acquisition, apply to a court for an order reversing the acquisition, and the court may order— |
| (a) |
the person from whom the shares were acquired to return the amount paid by the company; and |
| (b) |
the company to issue to that person an equivalent number of shares of the same class as those acquired. |
| (a) |
was present at the meeting when the board approved an acquisition of shares contemplated in this section, or participated in the making of such a decision in terms of section 74; and |
| (b) |
failed to vote against the acquisition of shares, despite knowing that the acquisition was contrary to this section or section 46. |
| (8) |
A decision by the board of a company, contemplated in subsection (2)(a), must be approved by a special resolution of the shareholders of the company— |
| (a) |
if any shares are to be acquired by the company from— |
| (i) |
a director of the company; |
| (ii) |
a prescribed officer of the company; or |
| (iii) |
a person related to a director of the company or a prescribed officer; or |
| (b) |
if it entails the acquisition of shares in the company, other than shares acquired as a result of— |
| (i) |
a pro rata offer made by the company to all shareholders of the company or a particular class of shareholders of the company, notwithstanding that the pro rata offer made to all shareholders may also include shareholders who are one or more of the persons referred to in paragraph (a); or |
| (ii) |
transactions effected on a recognised stock exchange on which the shares of the company are traded, being a licenced exchange as contemplated in the Financial Markets Act, 2012 (Act No. 19 of 2012). |
[Section 48(8) substituted by section 11 of the Companies Amendment Act 16 of 2024, Notice No 5082, GG50991, dated 30 July 2024 – effective 27 December 2024 per Notice 238, GG51837 dated 27 December 2024]
Electricity Regulation Act, 2006
