ADVOKS GLOBAL · KENYA
Companies Act
533. Treatment of proceeds of sale of treasury shares
Edition: 2024-12-27 · In force
533. Treatment of proceeds of sale of treasury shares
(1)This section applies when shares held by a company as treasury shares are sold.(2)If the proceeds of the sale are equal to or less than the purchase price paid by the company for the shares, the proceeds are, for the purposes of Part XVII, taken to be a realised profit of the company.(3)If the proceeds of the sale exceed the purchase price paid by the company—(a)an amount equal to the purchase price paid is taken to be a realised profit of the company for the purposes of Part XVII; and(b)the company shall transfer the excess to its share premium account.(4)For the purposes of this section—(a)the purchase price paid by the company is to be determined by the application of a weighted average price method; and(b)if the shares were allotted to the company as fully paid bonus shares, purchase price paid for them is nil.