SANDVIKEN, Sweden, Feb. 9, 2005 (PRIMEZONE) -- Sandvik's earnings trend, cash flow and strong balance sheet provide the Board of Directors the possibility of proposing an extraordinary distribution in addition to the ordinary dividend of SEK 4.0 billion, or about SEK 16 per share. It is proposed that the extraordinary distribution be effected through the redemption of shares.
The total distributed amount, including the proposed dividend of SEK 11 per share, amounts to SEK 6.7 billion, or SEK 27 per share.
The distribution should be viewed as part of Sandvik's goal in the long term to enhance the efficiency of the company's capital structure and, consequently, maximize value for the company's shareholders. Accordingly, the proposal of an extraordinary distribution through redemption replaces the earlier buyback program. It is proposed that the repurchased shares totaling 16,522,000 be canceled through a decision at the Annual General Meeting on 3 May. Use of redemption for the distribution provides the shareholders the freedom to choose between redeeming the shares or selling the redemption rights and thereby retaining their Sandvik shares. As a result, the method is effective for Sandvik's shareholders and, relative to other distribution methods, yields a positive effect on earnings per share.
In brief, the proposal involves the following process:
-- Information about the redemption price and the redemption ratio
will be provided in conjunction with the invitation to the
Annual General Meeting to be held 3 May.
-- The Annual General Meeting on 3 May 2005 decides on the
redemption proposal.
-- The record date is set directly at the Annual General Meeting.
-- Shareholders will be provided the opportunity to trade in
redemption rights during the application period, which is planned
for the latter part of May and first part of June.
-- An Extraordinary General Meeting in Sandvik decides on the
redemption after the application period has expired.
-- Payment of the redemption amount is expected in the beginning of
July.
-- Information brochure about the offering will be sent to shareholders
prior to the application period.
-- The usual conditions for the process apply.
Sandviken, 9 February 2005
Sandvik AB; (publ)
Sandvik is a high-technology engineering group with advanced products and world-leading positions in selected areas -- tools for metalworking, machinery and tools for rock excavation, stainless steel, special alloys, metallic and ceramic resistance materials as well as process systems and sorting systems. The Group has 38,000 employees in 130 countries, with annual sales of approximately SEK 55,000 M.
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