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OptiBiotix rejig will allow the life sciences group pay a dividend

Rather than making regular cash pay-outs, the company wants to be able to sanction a “dividend in specie” that would allow it to distribute its holding in SkinBioTherapeutics
word 'dividends' marked on file
The company is seeking shareholder approval for the changes

Life sciences group OptiBiotix Health plc (LON:OPTI) is seeking shareholder consent to re-organise its capital structure so it can make future dividend payments.

Rather than making regular cash pay-outs, the company wants to be able to sanction a “dividend in specie” that would allow it to distribute its holding in SkinBioTherapeutics PLC (LON:SBX).

READ: Coffee that loses you weight among products being developed by Optibiotix

After spinning off the business, which is focused on treatments that use and modify the microbiome that resides on the skin, OptiBiotix still holds 41.9% of the separately listed firm.

The mechanics

The nuts and bolts of what is essentially a procedural matter are as follows: a proposed capital reduction will lead to the cancellation of OptiBiotix’s share premium account.

This will then create distributable reserves that will allow it to pay dividends either in cash, or in specie “should circumstances in the future make it desirable to do so”.

WATCH: Massive opportunities for OptiBiotix Health's new and improved SlimBiome

Distributing shares in SkinBioTherapeutics means OptiBiotix is not forced to sell stock in the market and then make a cash return.  

Greater flexibility 

“The ability to make dividend payments provides the flexibility to consider paying a 'dividend in specie' to the company's shareholders of shares it holds in SkinBioTherapeutics, should it be appropriate to do so,” said Opti’s chief executive Stephen O'Hara.

“This is part of our strategy of building value across OptiBiotix divisions and where possible releasing value back to shareholders."

The company is a specialist in the emerging area of life science that involves the gut microbiome and is developing functional foods and treatments that help lower cholesterol, aid weight loss and which could help prevent diabetes.

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