DIVERSIFIED investment company Straits Trading : S20 0% wants to adopt a scrip dividend scheme that will allow shareholders to opt for dividend payouts in new shares, instead of cash.

“The scrip dividend scheme will enable eligible shareholders to reinvest in the company and further their participation in the equity capital,” Straits Trading said in a Tuesday (Mar 28) bourse filing, adding that this would not incur brokerage fees, or transaction and other related costs.

Straits Trading’s board believes that the scheme will create “long-term sustainable value” for shareholders, while also allowing the company to retain cash to fund growth, strengthen its working capital position and enhance financial flexibility.

The company intends to seek specific shareholders’ approval for the issuance of new shares under the scheme at its upcoming 135th annual general meeting on Apr 28. All shareholders would be eligible to participate in the scrip dividend scheme, subject to restrictions on overseas and certain other shareholders.

Straits Trading ended Monday flat at S$2.20.