UMS yesterday announced that they will propose a bonus share issue of 1 share for 4 shares shareholders already owned.
Announcement
here.
The rationale of the bonus issue is as such:
The Company is considering the Proposed Bonus Share Issue to increase the issued share capital base of the Company to reflect the growth and expansion of the Group’s business, and to give due recognition to its shareholders for their continuing support for the Company at the same time. The Proposed Bonus Share Issue, if carried out, will also increase the accessibility of an investment in the Company to more investors, thereby encouraging trading liquidity and greater participation by investors and broadening the shareholder base of the Company.
Bonus shares technically do not have much difference from a share split. It usually means instead of paying out cash dividends, I give you “shares” instead. Its an indirect way of saying, ......