Tate & Lyle PLC on Wednesday said it plans to repay and cancel all its preference shares as their costs outweigh their value to the company.
The London-based food and beverage ingredients provider said it plans to cancel and repay all 6.5% cumulative preference shares to reduce share capital.
In connection with the reduction, Tate & Lyle will return £1.00 per preference share plus a 3.25% dividend due.
The company said that at close of business on June 14 it had 2.4 million preference shares in issue. ‘The costs of administering the preference shares and maintenance of the register are disproportionate to the value of the preference shares,’ it added.
Tate & Lyle plans to call an annual general meeting vote to approve the cancellation of the preference shares. As the motion will be a special resolution, the company needs support from at least 75% of shareholders. It will also need confirmation from the High Court.
Shares in Tate & Lyle were up 2.3% to 750.20 pence each in London on Wednesday morning.
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