Sime Darby Berhad Proposes Dividend Reinvestment Plan
Sime Darby Berhad Proposes Dividend Reinvestment Plan
Kuala Lumpur
30 August 2013
Sime Darby Berhad has proposed a dividend reinvestment plan (DRP) that will grant shareholders the option to reinvest their dividends in new shares in lieu of receiving cash.
The DRP will allow Sime Darby to retain cash that could be used to fund existing operations and future expansion. At the same time, the stock’s liquidity will be improved as more shares will be available for trading.
“This is a scheme that has clear benefits for both the shareholders and the Group. Our shareholders will have a choice between cash and/or shares for dividends, depending on their investment objectives. For Sime Darby, the DRP allows our funds to be retained to grow our business and also strengthen our capital base,” said President and Group Chief Executive Tan Sri Dato’ Mohd Bakke Salleh.
Sime Darby will seek approval from shareholders at an Extraordinary General Meeting in November 2013 for the implementation of the DRP, which will initially apply to the final dividend for the financial year ended 30 June 30 2013 (Final Dividend). The Group had paid an Interim Dividend of 7 sen per share on 10 May 2013 and announced a Final Dividend of 27 sen a share today for the shareholders’ approval in the forthcoming Annual General Meeting. This brings the total dividend to 34 sen a share or a payout ratio of 55 per cent.
The new shares under the DRP (for the Final Dividend) will be issued at a discount of 5 per cent to the 5-day volume weighted average market price of Sime Darby shares immediately before the Price Fixing Date, after adjusting for the Final Dividend. They will also be issued free of brokerage fees and related transaction costs, except for minimal subscription expenses.
Shareholders will have 3 options under the DRP for the Final Dividend. They can:
Overseas shareholders who wish to participate in the DRP should provide the Registrar with a registered address in Malaysia to facilitate the service of documents in Malaysia.
To participate in the DRP, shareholders must complete and send in the Notice of Election by the Expiry Date, which has tentatively been set in mid-January 2014.
Further details will be provided later in the Circular to Shareholders in relation to the DRP.