Dubai: Saudi Basic Industries, the world's biggest chemicals maker by market value, said it plans to increase the number of its shares outstanding by a fifth through issuing one "free'' share for every five held.
The Saudi state-controlled chemical maker, known as Sabic, will increase the number of its shares to three billion from 2.5 billion, raising its share capital to 30 billion Saudi riyals ($8 billion) from 25 billion riyals, the company said in a statement posted on the website of the Saudi bourseon Sunday.
Sabic's board also agreed to pay a dividend of five billion riyals to shareholders for the second half of 2007, or two riyals per share, taking the full-year dividend to three riyals per share, the company said in the statement.
"They won't want to distribute a lot of cash as a dividend because they have a lot of major projects to fund, so they give investors part of it as cash and the remaining as stock,'' said Ebrahim Al Alwan, deputy chief executive officer of KSB Capital.
The state-controlled company's access at fixed prices to the world's biggest reserves of oil used to make chemicals and plastics has helped Sabic expand while rivals struggle with record crude prices.
Sabic shares, up more than 90 per cent this year, declined 2.4 per cent to 201 riyals at 11.35am local time.
Sabic's chief executive officer Mohammad Al Mady said he wasn't immediately free to comment when contacted on his mobile phone yesterday. Chief financial officer Mutlaq Al Morished didn't answer a call to his mobile phone.
Sabic's affiliate Saudi Fertilisers (Safco) also said yesterday it would offer shareholders a one-for-four bonus share issue and two riyals in dividend for the second half of 2007.