Key words: share buy back, companies
Question
Can a Company acquire shares in itself?
Answer
The Corporations Act explicitly prohibits a Company from acquiring shares in itself except as permitted within the Act: see s 259A. For example, a Company can purchase its own shares if a) the buy-back does not materially prejudice the Company's ability to pay its creditors; and b) the Company follows the procedure laid out under the relevant Division of the Act: see s 257A for further information.