Transaction in Own Shares
- None.
- None.
Insights
A share buyback, such as the one executed by Shell plc, is a corporate financial strategy where a company purchases its own shares from the marketplace. This can be an indicator of the company's liquidity and confidence in its own long-term value. By reducing the number of shares outstanding, earnings per share (EPS) may increase, potentially making the stock more attractive to investors. However, the impact on the company's stock price can vary depending on market perception and the scale of the buyback.
From a financial analysis perspective, the volume of shares repurchased and the prices paid provide insight into the company's valuation approach. The volume weighted average price (VWAP) paid per share is particularly telling, as it reflects the average price the company has paid, weighted by volume, over a specified time period. Investors often compare this to the current market price to assess whether the company is buying back shares at a higher or lower price than the market valuation.
Furthermore, the announcement specifies that the buyback is part of a pre-announced program, suggesting that this is a planned capital allocation strategy rather than a reactive decision. This could be seen as a positive signal to the market, indicating disciplined financial planning.
Share buybacks can have a ripple effect across the broader market and sector. When a company as significant as Shell plc engages in such activities, it can lead to a reevaluation of the energy sector's stock valuations. Other companies in the sector may be scrutinized for their capital return strategies, including dividends and buybacks.
Analysts might also look at the timing and execution of the buyback. The fact that Shell has chosen to execute the buyback across multiple trading venues and currencies indicates a strategy to minimize market disruption and possibly obtain better pricing through liquidity in different markets. This can be seen as a sophisticated approach to capital management.
Additionally, the role of Citigroup Global Markets Limited as an independent decision-maker in the trading decisions can be a strategic move to ensure that the buyback program is executed efficiently, benefiting from Citigroup's expertise in market timing and price execution.
Compliance with EU Market Abuse Regulation (EU MAR) and its UK equivalent (UK MAR) is crucial in share buyback programs. These regulations ensure that the buybacks are conducted in a transparent manner, preventing market manipulation and insider trading. The detailed reporting of individual trades by Citigroup Global Markets Limited on behalf of Shell plc is a requirement under these regulations to maintain market integrity.
Understanding the legal framework is important for stakeholders, as non-compliance could lead to severe penalties and loss of investor trust. The company's adherence to the pre-set parameters set out in the EU MAR Delegated Regulation and its UK counterpart reflects its commitment to legal and regulatory adherence, which can be reassuring to investors and market participants alike.
Transaction in Own Shares
15 February, 2024
• • • • • • • • • • • • • • • •
Shell plc (the ‘Company’) announces that on 15 February 2024 it purchased the following number of Shares for cancellation.
Aggregated information on Shares purchased according to trading venue:
| Date of purchase | Number of Shares purchased | Highest price paid | Lowest price paid | Volume weighted average price paid per share | Venue | Currency |
| 15/02/2024 | 1,470,000 | LSE | GBP | |||
| 15/02/2024 | - | Chi-X (CXE) | GBP | |||
| 15/02/2024 | 500,000 | BATS (BXE) | GBP | |||
| 15/02/2024 | 1,600,000 | XAMS | EUR | |||
| 15/02/2024 | 430,000 | CBOE DXE | EUR | |||
| 15/02/2024 | - | TQEX | EUR |
These share purchases form part of the on- and off-market limbs of the Company's existing share buy-back programme previously announced on 1 February 2024.
In respect of this programme, Citigroup Global Markets Limited will make trading decisions in relation to the securities independently of the Company for a period from 1 February 2024 up to and including 26 April 2024.
The on-market limb will be effected within certain pre-set parameters and in accordance with the Company’s general authority to repurchase shares on-market. The off-market limb will be effected in accordance with the Company’s general authority to repurchase shares off-market pursuant to the off-market buyback contract approved by its shareholders and the pre-set parameters set out therein. The programme will be conducted in accordance with Chapter 12 of the Listing Rules and Article 5 of the Market Abuse Regulation 596/2014/EU dealing with buy-back programmes (“EU MAR”) and EU MAR as “onshored” into UK law from the end of the Brexit transition period (at 11:00 pm on 31 December 2020) through the European Union (Withdrawal) Act 2018 (as amended by the European Union (Withdrawal Agreement) Act 2020), and as amended, supplemented, restated, novated, substituted or replaced by the Financial Services Act, 2021 and relevant statutory instruments (including, The Market Abuse (Amendment) (EU Exit) Regulations (SI 2019/310)), from time to time (“UK MAR”) and the Commission Delegated Regulation (EU) 2016/1052 (the “EU MAR Delegated Regulation”) and the EU MAR Delegated Regulation as “onshored” into UK law from the end of the Brexit transition period (at 11:00 pm on 31 December 2020) through the European Union (Withdrawal) Act 2018 (as amended by the European Union (Withdrawal Agreement) Act 2020), and as amended, supplemented, restated, novated, substituted or replaced by the Financial Services Act, 2021 and relevant statutory instruments (including, The Market Abuse (Amendment) (EU Exit) Regulations (SI 2019/310)), from time to time.
In accordance with EU MAR and UK MAR, a breakdown of the individual trades made by Citigroup Global Markets Limited on behalf of the Company as a part of the buy-back programme is detailed below.
Enquiries
Media International: +44 (0) 207 934 5550
Media Americas: +1 832 337 4335
LEI number of Shell plc: 21380068P1DRHMJ8KU70
Classification: Acquisition or disposal of the issuer’s own shares
Attachment
FAQ
How many shares did Shell plc purchase on 15th February 2024?
At what prices did Shell plc purchase shares on 15th February 2024?
Who will make trading decisions for Shell plc's share buy-back program?
In which markets did Shell plc purchase shares on 15th February 2024?
What regulations does Shell plc's share buy-back program comply with?
