17 July 2012
Media Chinese International Ltd has proposed to undertake a distribution via a proposed special dividend to shareholders of approximately US$219.78mil (RM700mil) or US$0.13 (41 sen) per share, to undertake a capital reduction of about US$219.78mil to facilitate the proposed dividend
Media Chinese International Ltd has proposed to undertake a distribution via a proposed special dividend to shareholders of approximately US$219.78mil (RM700mil) or US$0.13 (41 sen) per share.
The company said in a statement that it would undertake a capital reduction of about US$219.78mil to facilitate the proposed dividend.
“The credit arising from the proposed capital reduction and thereafter the credit standing in the contributed surplus account of Media Chinese will be applied towards the proposed dividend,” it said, adding that the proposed dividend would be part financed by internal funds amounting to approximately US$62.8mil and new bank borrowings of approximately US$157mil.
“By part financing the proposed dividend via new bank borrowings, the company would be able to enhance its capital structure and mix without unduly burdening the group in terms of its cash flow and earnings capability,” Media Chinese explained.
“Moreover, with the company's track record of having a strong Ebitda (earnings before interest, tax, depreciation and amortisation), the company should be able to support a net debt of US$124.85mil resulting from the new borrowings,” it added.
The increase in gearing was not expected to impede the company's ability to embark on new business opportunities. Moreover, the company said it would still maintain a reasonable cash balance to embark on any new business opportunities and to meet its capital commitments after the proposals, which were expected to complete by the fourth quarter of this year.
Trading in Media Chinese shares has been suspended since last Friday pending the above announcement. It will resume trading today