Platinum Capital Suspends Dividend Reinvestment Plan Amid Major Restructure
Platinum Capital Limited has released detailed worked examples for its proposed scheme of arrangement, outlining a special dividend payout and the exchange ratio for shares into ETF units. The final dividend value and unit allocation will be confirmed closer to the scheme implementation date.
- Proposed scheme swaps Platinum Capital shares for units in Platinum International Fund Complex ETF
- Special Dividend to be paid if scheme proceeds, roughly equal to retained earnings after restructure costs
- Dividend reinvestment plan suspended pending scheme outcome
- Worked examples show potential dividend of 14.5 cents per share and exchange ratio of 262 ETF units per 1,000 shares
- Final dividend amount and unit allocation to be announced before scheme implementation, expected 25 August 2025
Background to the Scheme
Platinum Capital Limited (ASX – PMC) has provided shareholders with a comprehensive update on its proposed restructure, which involves a scheme of arrangement to exchange existing shares for units in the Platinum International Fund Complex ETF (ASX – PIXX). This move aims to streamline the company’s structure and align shareholder interests with the ETF’s broader investment strategy.
Special Dividend Mechanics
A key feature of the scheme is the payment of a Special Dividend, contingent on the scheme’s approval and implementation. The dividend is designed to distribute the company’s retained earnings, adjusted for restructure-related costs and expenses, to shareholders. While the dividend will be franked to the maximum extent possible, it will not be fully franked.
Using 30 June 2025 as a reference valuation date, the company illustrated a worked example where the Special Dividend would be approximately 14.5 cents per share. For a shareholder holding 1,000 shares, this translates to a $145 payout. The example also indicates the dividend would be about 60.75% franked, reflecting available franking credits.
Share Exchange Ratio Explained
The announcement also detailed how shares will be converted into new ETF units. The formula considers the company’s net tangible assets (NTA) per share, adjusted for the Special Dividend and restructure costs, against the ETF’s net asset value (NAV) per unit. In the example provided, 1,000 shares would convert into 262 new ETF units. This exchange ratio ensures shareholders receive a fair value equivalent in the new structure.
Dividend Reinvestment Plan Suspended
In light of the scheme, Platinum Capital has suspended its dividend reinvestment plan immediately. Should the scheme proceed, the plan will remain suspended and will not apply to the Special Dividend. The board will revisit this decision if the scheme does not go ahead, keeping shareholders informed through official channels.
Next Steps and Shareholder Considerations
Shareholders can expect a further update with additional worked examples on 11 August 2025, just before the scheme meeting. The final Special Dividend amount will be announced by 10am on the day the scheme is implemented, currently anticipated to be 25 August 2025. Shareholder approval remains a critical hurdle, and the company has emphasized that the dividend will not be paid if the scheme fails to proceed.
Bottom Line?
As Platinum Capital moves closer to finalising its restructure, investors should watch for the upcoming dividend announcement and shareholder vote outcomes.
Questions in the middle?
- What will be the final Special Dividend amount once all restructure costs are accounted for?
- How will the market value the new ETF units compared to the current shares post-scheme?
- What are the potential impacts on liquidity and trading for shareholders post-conversion?
