Raffles Holdings Limited with the proposed sale of 45% of the "Raffles City" complex from associated company, Tincel Properties (Private) Limited, to CapitaCommercial Trust has proposed a capital reduction exercise and capital distribution to provide a clean exit for the shareholders of the Company ("Shareholders") from their shares in the Company and the cash to be distributed to Shareholders.
Raffles holding wishes to announce that up to S$0.70 in cash per Share will be returned to Shareholders in the fourth quarter of 2006. This amount will be returned to Shareholders through the Capital Distribution of S$0.37 in cash per Share pursuant to the Capital Reduction, and up to S$0.33 in cash for each Share by way of a special dividend (the "Special Dividend") payable as an interim tax exempt (one-tier) dividend for the financial year ended 31 December 2006 ("FY2006"), after the Company has received the proceeds of the Sale and the necessary regulatory approvals, including but not limited to, the sanction of the High Court for the Capital Reduction and after making provisions for tax and other liabilities.
Recommendation:
Share is expected to trade below S$0.70, should it rise above S$0.70, take profit.
Else recommend to accept the cash distribution and special dividend, to reduce expenditure for brokerage fees.
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