KUALA LUMPUR (Nov 16): Mulpha International Bhd announced today it plans to distribute to its shareholders up to 90.33 million shares in Mudajaya Group Bhd, via a dividend-in-specie.

This represents approximately 15.31% equity interest in Mudajaya, currently held by Mulpha International’s wholly-owned subsidiary, Mulpha Infrastructure Holdings Sdn Bhd.

In a filing with the stock exchange today, Mulpha said the proposed dividend-in-specie is undertaken as an extension of its streamlining strategy where it gradually disposes of its non-core investments. Mulpha said the original cost of investment in the dividend shares is RM33.2 million.

The proposed dividend-in-specie, which will be paid out of Mulpha’s retained earnings, is also to reward shareholders by providing them with an opportunity to invest directly in Mudajaya at no cost, it added.

The indicative distribution basis for the proposed dividend-in-specie is one Mudajaya share for every 3.537 or 3.538 Mulpha shares held, depending on whether the treasury shares are retained or resold by Mulpha in the open market.

The final distribution basis will depend on the actual number of the company’s issued shares at an entitlement date to be announced at a later stage.

Mulpha said the indicative value per dividend share is 40 sen, based on the five-market day volume weighted average share price of Mudajaya as at November 15 being the latest practicable date.

“For illustrative purposes, an entitled shareholder who holds 353 Mulpha Shares and shall be entitled to 99 dividend shares (fractional entitlements disregarded), will instead receive cash of RM39.60 (being 99 dividend shares multiplied by indicative value per dividend share of 40 sen).

“Any entitled shareholders who have not deposited their Mulpha shares into central depository system accounts as at the entitlement date will also receive cash in lieu of the actual number of dividend shares that they would otherwise be entitled to receive.”

The proposal, which is not subject to shareholders’ approval, is expected to be completed by the first quarter of next year.

Shares in Mulpha closed unchanged today at RM1.74 for a market capitalisation of RM555.87 million. Mudajaya, meanwhile, finished one sen lower at 40 sen, valuing the company at RM235.95 million.