Neometals (ASX:NMT) has outlined a proposal to initiate an on‐market buy-back of ordinary shares.
Neometals could purchase up to a maximum of 5% of the company’s shares, and will not buy-back more than A$5 million worth of shares over 12 months.
No shares were acquired under the 2016 buy-back.
If the company proceeds, then this will tighten the share register and provide a potential catalyst for a higher share price.
The reason for this is that if the company's maintains its market valuation, but has fewer shares, then each share needs to be worth more.
The company is focused on lithium, but recently added cobalt exposure to its portfolio.