Custom Search

Thursday, 25 March 2010

Maybank Proposes Dividend Reinvestment Plan

Maybank is proposing to undertake a recurrent and optional dividend reinvestment plan that allows shareholders of Maybank to reinvest their dividend into new ordinary shares of RM1.00 each in Maybank.

In a filing to Bursa Malaysia, the company said the proposed dividend reinvestment plan is part of its efforts to enhance and maximise shareholders' value via the subscription of new Maybank shares where the issue price of a new Maybank share shall be at a discount of not more than 10 per cent to five-day volume weighted average market price.

It said the proposed plan will provide the shareholders with greater flexibility in meeting their investment objectives, as they would have the choice of receiving cash or reinvesting in the company through subscription of additional Maybank shares without having to incur material transaction or other related costs.

The company will also benefit from the participation by shareholders in the proposed dividend reinvestment plan to the extent that if the shareholders elect to reinvest the electable portion into new Maybank shares, the cash which would otherwise be payable by way of dividend will be retained to fund the continuing growth and expansion of Maybank and its subsidiaries.

The retention of cash and the issue of Maybank shares under the proposed plan will not only enlarge the company's share capital base and strengthen its capital position, but will also add liquidity of Maybank shares on the Main Market of Bursa Malaysia.

The proposed dividend reinvestment plan is expected to be put in place by the second quarter of 2010.