IG Group seeks to rectify position regarding certain dividends
There were not sufficient distributable profits within the company at the time of payment of dividends in March 2010, October 2017 and March 2018.
Electronic trading major IG Group Holdings plc (LON:IGG) today posted a notice about its annual general meeting, which is poised to be held on September 17, 2020.
In addition to the standard business to be conducted at the 2020 AGM, a special resolution is being proposed to rectify the position in relation to certain dividends having been made by IG otherwise than in accordance with the Companies Act 2006.
IG’s Board has become aware of certain issues in respect of the payment of the historical dividends paid by the Company in March 2010, October 2017 and March 2018 ( the “Relevant Dividends”). These issues resulted in each of the Relevant Dividends being made otherwise than in accordance with the 2006 Act.
At the time the company made the Relevant Dividends, it did not have sufficient distributable profits. There were sufficient distributable profits within the Group as a whole, but the assessments made in calculating the amount of profits that were required to be remitted to the company in order to create sufficient distributable profits were incorrect. This led to insufficient distributable profits in the company at those times.
“Accordingly, the Relevant Dividends were, regrettably, made by the Company otherwise than in accordance with the 2006 Act”, IG says.
The total aggregate amount of the Relevant Dividends paid otherwise than in accordance with the 2006 Act was approximately £18.8 million, less than 15% of the aggregate Relevant Dividends paid. The Group’s current and historical capital positions are unaffected.
Resolution 24 which is proposed as a special resolution at the AGM is being proposed in order to:
- (i) remedy the potential consequences of the Relevant Dividends having been made by the Company otherwise than in accordance with the 2006 Act; and
- (ii) put all potentially affected parties so far as possible in the position in which they were always intended to be had the Relevant Dividends been made in accordance with the requirements of the 2006 Act.