Hammerson plc (LON:HMSO) has proposed a final dividend of 0.2 pence per ordinary share for the period ended 31 December 2021. The Board also intends to offer Shareholders an Enhanced Scrip Dividend Alternative of 2 pence per share. Both the Final 2021 Dividend and the Enhanced Scrip Dividend Alternative are subject to Shareholder approval at the Company’s AGM to be held at 11.00 a.m. (British Summer Time) on Thursday, 28 April 2022, the details of which will be announced in due course.
Both the Final 2021 Dividend and the Enhanced Scrip Dividend Alternative will be paid as a Property Income Distribution, net of withholding tax where appropriate.
Shareholders who elect to participate in the Enhanced Scrip Dividend Alternative will, in respect of the Final 2021 Dividend, receive such number of new fully paid shares as is equal to 2 pence divided by the scrip reference share price, for each Share held on the dividend record date (1 April 2022). The scrip reference share price will be announced to the London Stock Exchange, Euronext Dublin and to the JSE on SENS on Tuesday, 22 March 2022.
Further details of the Enhanced Scrip Dividend Alternative, including how shareholders can elect to participate, will be circulated to shareholders on Wednesday, 23 March 2022. Shareholders should consider their own individual circumstances before making an election to receive the Enhanced Scrip Dividend Alternative, and are recommended to seek their own independent financial advice. However, given the significant difference in value between the cash Final 2021 Dividend and the Enhanced Scrip Dividend Alternative, the Board considers that for most Shareholders it will be in their interests to elect to receive the Enhanced Scrip Dividend Alternative, as each Director intends to do in respect of his or her own beneficial holdings.
The expected timetable for the payment of the Final 2021 Dividend and the Enhanced Scrip Dividend Alternative is set out at the end of this announcement.
It is the responsibility of any overseas shareholder wishing to elect to receive the Enhanced Scrip Dividend Alternative to be satisfied as to the full observance of the laws of the relevant territory without any further obligation on the part of the Company, including obtaining any government or other consents which may be required, observing any other formalities in such territories and any resale restrictions which may apply to the New Shares.
The Board retains the discretion to withdraw or modify the terms of the Enhanced Scrip Dividend Alternative at any time, and to withdraw or modify the Final 2021 Dividend at any time up to the time at which the resolution approving the Final 2021 Dividend is put to shareholders at the AGM, because there are certain situations in which the Board may decide that it is no longer appropriate to pay the Final 2021 Dividend and to offer the Enhanced Scrip Dividend Alternative, or it may not be permissible for Hammerson to do so.
Background to and reasons for the Final 2021 Dividend and Enhanced Scrip Dividend Alternative
As a UK Real Estate Investment Trust, the Company is obliged to distribute 90% of its tax-exempt income to Shareholders in the form of a PID each year. If the Company did not satisfy its PID obligations by the deadline, it could lose its REIT status, which would cause the Group to be liable to pay UK corporation tax on UK property income and capital gains.
Additionally, as a French Société d’Investissement Immobilier Cotée, the Company is obliged to distribute exempt property income and capital gains. Failure to satisfy the SIIC distribution requirement would lead to the Group losing its SIIC status and cause the Group to be liable to pay corporation tax in France on its French property income and capital gains (including the gain on the disposal of Italie Deux).
The Enhanced Scrip Dividend Alternative assists the Company in meeting its REIT PID and SIIC distribution obligations whilst retaining cash for future operating and capital expenses. In light of the ongoing COVID-19 pandemic and its effects on the retail sector, the Board considers that the Enhanced Scrip Dividend Alternative is the most prudent way for the Company to seek to meet its REIT PID and SIIC distribution obligations.
In order to encourage Shareholders to elect for the Enhanced Scrip Dividend Alternative and assist the Company in meeting its REIT PID and SIIC distribution obligations, Shareholders electing to receive the Enhanced Scrip Dividend Alternative will be entitled to receive New Shares with a significantly greater value than the cash Final 2021 Dividend. Both the cash Final 2021 Dividend and the value of Shares issued pursuant to the Enhanced Scrip Dividend Alternative will be designated as a PID and a SIIC distribution and will contribute to the satisfaction of the Company’s REIT PID obligation and SIIC distribution requirement
Expected Timetable of Events
| 2022 | |
| 1. Dividend declaration announcement released | Friday, 4 March |
| 2. Scrip reference share price calculation dates | Monday, 14 March – Friday, 18 March |
| 3. Date on which Shareholders must be recorded on the South Africa Register to receive the Circular | Friday, 18 March |
| 4. Currency conversion date | Friday, 18 March |
| 5. Currency conversion and scrip reference share price announcement released by 11.00 a.m. (SA time) | Tuesday, 22 March |
| 6. Posting of the Circular and announcement on SENS | Wednesday, 23 March |
| 7. Last day to effect removal of shares between the United Kingdom (“UK“) and South African (“SA“) Registers | Tuesday, 29 March |
| 8. Last day to trade on the Johannesburg Stock Exchange (“JSE“) to qualify for the dividend | Tuesday, 29 March |
| 9. Ex-dividend on the JSE from commencement of trading on | Wednesday, 30 March |
| 10. Last day to trade on the London Stock Exchange and on Euronext Dublin to qualify for the dividend | Wednesday, 30 March |
| 11. Ex-dividend on the London Stock Exchange and on Euronext Dublin from the commencement of trading on | Thursday, 31 March |
| 12. Fraction reference price announcement released by 11.00 a.m. (SA time) | Thursday, 31 March |
| 13. Record date (applicable to both the UK principal register and the SA branch register) | Friday, 1 April |
| 14. Removal of shares between the UK and SA registers permissible from | Monday, 4 April |
| 15. Last day for receipt of dividend mandates by Central Securities Depository Participants (“CSDPs“) and enhanced scrip dividend elections by SA Transfer Secretaries | Tuesday, 19 April |
| 16. Last date for UK registrar to receive Forms of Election from shareholders on the UK register holding certificated shares electing to receive the enhanced scrip dividend | Tuesday, 19 April |
| 17. Last date for shareholders on the UK register holding uncertificated shares on CREST to elect to receive the enhanced scrip dividend | Tuesday, 19 April |
| 18. Last day to trade in the Company’s shares in order to be recorded as a shareholder ahead of the Voting Record Date (SA) | Thursday, 21 April |
| 19. Voting Record Date for the Annual General Meeting (SA) | Tuesday, 26 April |
| 20. Voting Record Date for the Annual General Meeting (UK and ROI) | Tuesday, 26 April |
| 21. Annual General Meeting | 11:00 a.m. (London time) and 12:00 p.m. (South African Standard Time) on Thursday, 28 April |
| 22. Dividend Payment Date (UK and ROI)Expected date of issue, admission and first day of dealings in the New Shares on the London Stock Exchange and Euronext Dublin | Tuesday, 10 May |
| 23. Dividend Payment Date (South Africa)CSDP accounts credited on the South Africa RegisterExpected date of issue, admission and first day of dealings in the New Shares on the JSE | Tuesday, 10 May |
Notes:
1. The scrip share reference price is calculated by taking the average of the middle market quotations for Shares on the LSE (for shareholders on the UK register) or the JSE (for shareholders on the SA register) for the last five dealing days ending on the Currency Conversion Date less the gross value of the cash Dividend per Share.
2. For Shareholders on the UK Register, entitlements to fractions of New Shares will be paid based on the value of the Enhanced Scrip Dividend Alternative.
3. The cash fraction reference price for shareholders on the South Africa register is determined by taking the volume weighted traded price on the JSE on the date at which the Shares begin trading on the JSE ex the cash dividend or Enhanced Scrip Dividend Alternative, discounted by 10%.
4. The removal of shares to and from the UK principal register and the SA branch register will not be permitted between Wednesday, 30 March 2022 to Friday, 1 April 2022, both dates inclusive.
5. Shareholders registered on the SA branch register should note that, in accordance with the requirements of Strate, no dematerialisation or rematerialisation of shares will be possible from Wednesday, 30 March 2022 to Friday, 1 April 2022, both dates inclusive.
6. Securities transfer tax will not be payable in respect of the issue of New Shares to South African Shareholders.
7. Shareholders registered on the SA branch register will be paid in SA Rand.
8. A summary of how UK Shareholders and South Africa Shareholders are likely to be treated for tax purposes will be set out in Section 2 of the Guide containing the terms and conditions of the Enhanced Scrip Dividend Alternative, which is expected to be made available to Shareholders on Wednesday, 23 March 2022. The effect on a Shareholder’s tax position of electing to receive New Shares instead of cash in respect of the Final 2021 Dividend will depend upon the personal circumstances of that Shareholder. If you are in any doubt as to your tax position or you are subject to tax in a jurisdiction outside the UK or South Africa (including the Republic of Ireland), you should consult an appropriate professional adviser before taking any action.
9. As the Company is offering the Enhanced Scrip Dividend Alternative for the Final 2021 Dividend, it intends to suspend the Dividend Reinvestment Plan. Participation in the DRIP does not confer automatic participation in the Enhanced Scrip Dividend Alternative and so participants in the DRIP who wish to receive the Enhanced Scrip Dividend Alternative will need to elect to participate in the Enhanced Scrip Dividend Alternative.
10. Please note that all previously completed forms of election or other forms of instruction in respect of earlier scrip dividend schemes (including the December 2021 interim dividend) have been cancelled. Any Shareholder wishing to participate in the Enhanced Scrip Dividend Alternative must therefore complete a new Form of Election or elect to participate in the Enhanced Scrip Dividend Alternative.
11. As at Friday, 4 March 2021, being the declaration date of the Final 2021 Dividend, the Company had a total of 4,419,457,161 ordinary shares in issue, with 7,691,247 of those ordinary shares held in Treasury.
12. The cash element of the Final 2021 Dividend will be paid out of Hammerson’s UK distributable reserves. It is intended that the nominal value of the new shares issued to shareholders who validly elect to participate in the Enhanced Scrip Dividend Alternative will be paid up using reserves from the Company’s share premium account.
13. The dates above are subject to change. Any changes made will be communicated as soon as practicably possible.
