share buyback. how does it work?, page-13

Look put in very simple terms. A company that has spare money doing a buy back is great thinking. What it means in simple terms is this. The company buys back its own shares then get rid of them. So now the shares they have bought don't exist no more, but the worth (market cap) of the company with all things being equal doesn't change so less shares same market cap.

The shares in tune form should and usually do rise. another way of saying it is you will always get a larger slice of cake if the cake is cut into less slices.