The company issued the guidance in response to a question from a shareholder, Peterson Mutwiri, who asked whether the dividend would be paid this year or in 2021.
Marketing services firm Scangroup says it plans to pay a special dividend of Sh4.7 per share or an aggregate of Sh2 billion later this year using proceeds from the sale of its 60 percent stake in Kantar Africa.
The Nairobi Securities Exchange-listed firm issued the guidance in response to a question from a shareholder, Peterson Mutwiri, who asked whether the dividend would be paid this year or in 2021.
“The intent is to pay the special dividend before the end of 2020. This is assuming we deliver to all the conditions precedent and achieving completion of the transaction before the end of June 2020,” Scangroup said in a response published on its website.
The virtual interaction with shareholders was part of the company’s extraordinary general meeting on Wednesday that saw the proposed transaction put to a vote.
The deal is expected to be approved since a simple majority of 50 percent-plus one is required, with the company’s controlling shareholder WPP Plc owning a 56.25 percent stake and supporting the transaction.
Scangroup said results of the voting could be out from Thursday.
“The results shall be published in the company’s website within 24 hours and also via SMS,” the firm’s shares administrator Image Registrars said in a notice yesterday. Scangroup says net proceeds from the transaction will be Sh5 billion and that it will use at least 40 per cent of the amount (Sh2 billion) to pay the special dividend. This will amount to a payout of about Sh4.7 per share.
“The funds received from the disposal will result in a cash surplus in the company…as the independent Kantar Transaction Committee negotiated not to give any operational warranties in respect of the disposal such cash remains unencumbered,” Scangroup said in a circular to shareholders.
“The board will review the optimal use of proceeds taking into consideration potential expansion, capital needs and cash flows, but expects that at least 40 percent of the net proceeds to be returned to shareholders in the form of a special dividend.”
Scangroup’s net profit dropped 20 percent to Sh491.4 million in the year ended December from Sh612.2 million a year earlier.
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Note: The results are not exact but very close to the actual.
