Key Takeaways:
Magnificent (00201.HK) plans to pay a special dividend after its subsidiary agreed to sell back a stake in Shunho Property (00219.HK) to the company for approximately HKD 48.11 million.
According to a joint announcement from Magnificent, Shunho Property, and Shunho Holdings (00253.HK), the move is intended to provide Magnificent’s shareholders with an opportunity to realize their indirect investment in Shunho Property. Shares of Magnificent rose as much as 10% on the news.
The deal involves Mercury Fast Limited, a wholly-owned subsidiary of Magnificent, selling approximately 68.14 million shares back to Shunho Property. This represents 11.75% of Shunho Property’s total issued shares, at a cash consideration of HKD 48.1065 million.
The proposed special dividend from Magnificent would be funded by the proceeds from the share sale, after deducting related expenses. For Shunho Property, the buyback reduces its total number of shares outstanding, which can be accretive to earnings per share.
The payment of the special dividend is conditional upon completion of the share buyback and requires approval from Magnificent's shareholders at an upcoming special general meeting. Investors will be watching for the meeting's outcome and the finalization of the transaction.
This article is for informational purposes only and does not constitute investment advice.
