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Tate & Lyle to be re-positioned as growth business posted on Company News

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Dod101
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Re: Tate & Lyle to be re-positioned as growth business posted on Company News

#428007

Postby Dod101 » July 16th, 2021, 9:31 am

NeilW wrote:
The Proposed Transaction repositions Tate & Lyle as a growth-focused speciality FBS business, however the Board continues to recognise the importance of the dividend to total shareholder returns. Consistent with the sale of a controlling stake in the Primary Products business, it is intended to reduce the dividend to reflect the earnings base of the re-focused Tate & Lyle. The pay-out ratio is expected to be maintained and the dividend per share re- based by around 50%, before the impact of the share consolidation. Following completion, it is intended to return ~£0.5bn to shareholders and undertake a share consolidation. From there, it is intended that the progressive dividend policy will be maintained. Completion of the Proposed Transaction is expected in Q1 of calendar year 2022, therefore it is expected that the interim dividend for the 2022 financial year will be paid as usual, with the full year dividend for the 2022 financial year then being re-based.


https://www.tateandlyle.com/sites/default/files/2021-07/12-july-2021-tate-lyle-press-release-final.pdf

So about £1 per share capital return and a 50% drop in yield.

Another bin job.


They are selling a substantial chunk of their business so naturally there will be a loss of income but any holder will be getting a substantial return of capital to help reflect this. We cannot know the yield on the shares after the transaction until the market puts a value on the shares so I do not know how NeilW can claim a 50% drop in yield. Looks like a 50% or so drop in the dividend paid but that is not the same thing. It may not be appropriate for a HYP but then as someone said, it was only ever rather marginal and they now claim that they are repositioning the business as growth focussed. I do not hold but if I did I guess I would wait and see how the land lies after the transaction next year.

It might even work out quite well as they are handing over the management of their commodities business to another who probably sees savings to be made and maybe improved profitability. That would then feed into the 50% still owned by T & L. An interesting scene.

Dod

Arborbridge
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Re: Tate & Lyle to be re-positioned as growth business posted on Company News

#428164

Postby Arborbridge » July 16th, 2021, 5:31 pm

Dod101 wrote: I do not hold but if I did I guess I would wait and see how the land lies after the transaction next year.


Dod


Indeed, and that is exactly what I intend to do unless there is further news indicating a different course is desirable.
That served me well in other cases. like Carillion :lol: But seriously - I usually wait and let these events work through.


Arb


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