10th Oct 2014 12:50
LONDON (Alliance News) - Dignity PLC Friday said it plans to return GBP64.4 million to its shareholders, equating to GBP1.20 per share, increasing the previously promised cash return from the restructuring of its debt obligations.
Last month the funeral services provider said that as a result of the exchange offer to secured notes holders, the company would generate net new proceeds of GBP70 million, of which GBP54 million, or GBP1 per ordinary share, would be returned to its shareholders.
At the time, it said its overall balance sheet liability would increase to GBP580 million under the deal, but said its debt service costs would fall by GBP6 million to GBP34 million per year from GBP40 million at present.
However, in a statement Friday, the company said it expects gross proceeds from the transaction to be around GBP88 million, and as a result now intends to return GBP64.4 million to its shareholders.
"As a consequence of the transaction, the group's annual debt service obligations are expected to reduce from GBP40 million to around GBP33.2 million.
Dignity shares were trading 0.2% lower Friday afternoon at 1,500.000 pence.
By Rowena Harris-Doughty; [email protected]; @rharrisdoughty
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