Four Soft shares crack 69%, quote ex-dividend

Moneycontrol Bureau

Four Soft shares fell 69 percent on Thursday to close at Rs 12.75 on account of dividend payout. The stock from today is quoting ex-dividend and the record date for interim dividend payout has been fixed as October 18.
The software services provider on October 13 approved an interim dividend of Rs 29 per share -- 6 times higher than its face value of Rs 5 each, which will be paid on or after October 22, 2013.
Meanwhile, after paying dividend and taxes the company has proposed to retain Rs 25 crore for ongoing businesses and use the balance/surplus of Rs 56 crore for capital reduction scheme.
"The company proposes to reduce only 50 percent of the capital or 50 percent of the shares outstanding by paying a value of Rs 29 per share," the company said in its filing.
Srikanth Reddy, MD said, "The main reason for capital reduction is because we don't want to retain the extra cash that we got after selling assets. We don’t want the management to deal with the pressure of holding shareholders' money."
After the capital reduction, the company will be again in a start-up mode and is likley to do an earnings per share of Rs 1-2 per share going forward, said Reddy.
Capital reduction scheme by court proceedings is expected to take about six months and a separate record date will be set for Capital reduction scheme.
The company said the balance 50 percent of the shares would remain at a face value of Rs 5 per share.
Four Soft in its meeting October 13 also approved the change of name of the company from Four Soft to Palred Technologies.