Chorus dividend reinvestment plan underwriter Macquarie called on for $23.8m

About 54% of Chorus's shares took up the dividend reinvestment programme, up from 45% previously.

Macquarie Securities (NZ) will pay $23.8 million for 6.3 million new Chorus shares as the underwriter for the telecommunications network operator's dividend reinvestment programme.

About 54% of Chorus's shares took up the dividend reinvestment programme, up from 45% previously, meaning about $23.6 million will be paid in cash on October 10 when 12.5c per share dividend is due. Wellington-based Chorus announced the DRP price of $3.7672 today, a 3% discount to the five-day average trading price. The stock closed at $3.92 on Friday.

When announcing the final dividend at the company's annual result on August 28, chief executive Kate McKenzie and chairman Patrick Strange said the dividend reinvestment programme had been popular and would be available to help the company retain cash. About three weeks later the network operator said the DRP would be underwritten.

Chorus had cash and equivalents of $170 million as at June 30, generating a cashflow of $524 million in the year from operations, compared to $435 million a year earlier. The company's capital expenditure was $639 million in the 2017 financial year, which it sees rising to between $780-820 million in the year ending June 30, 2018 as it steps up the pace of work on the expanded national fibre network rollout.

(BusinessDesk)