MTF in bid to buy back shares
DUNEDIN finance company MTF Finance plans to buy back shares from shareholders no longer active in the business.
Earlier this week, the company’s board sent a disclosure document to all shareholders telling them of its intention to buy back shares from what it called ‘‘dry shareholders’’.
The dry shareholders would be those who had not been active in the company for more than six months and who had a balance of less than $200,000. The total number of shares held by dry shareholders was estimated to be about 25% of the company’s ownership, MTF chief executive Glen Todd said.
The shares were not listed on the NZX and were only available through its cooperative structure, he said.
He believed the company had a strong balance sheet and it had completed a successful round of funding in the New Zealand market.
‘‘That went extremely well for us, so we are in the position where we have capital available to be able to buy those shares back,’’ he said.
The buyback would rebalance MTF’s equity structure and provide those who wanted to exit the company with a way out, Mr Todd said.
‘‘The board are really signalling that under their strategic plan there is some big technology investment we are about to embark on and that could well mean that dividends in the coming years could possibly be reduced,’’ he said.
Trading of the shares on the Sharemart platform, a platform for unlisted issuers, would be temporarily halted until the completion of the offer period.
The buyback was capped at $5 million and would be made early next month.