Real estate agency franchising firm M Winkworth PLC (LON:WINK) said on Friday that it plans to return £1.146mln of surplus capital to shareholders.
The company, which is a well-regarded dividend payer, has proposed the cancellation of its £1.793 share premium account that will allow it to make the £1.146mln capital payment.
The balance will be transferred to the group’s profit and loss account, creating additional distributable reserves that may be used for future shareholder returns.
Shareholders will receive 9p in cash for every ordinary share of 0.5p in the company held at the record date.
Chief executive Dominic Agace said the group has created regular free cash flow since its admission to London’s junior market AIM in 2009 and believes it is in the shareholders’ "best interest" for excess capital to be returned.
"We remain alert to acquisition opportunities and, should the need arise, we will approach shareholders to help fund any sizeable acquisitions," he added.
"In the meantime, we continue to successfully grow our franchise network organically, with a further eight offices scheduled to be added in 2018."