Percy Fotherington Pays TFIG Dividend, Announces Share Buyback Policy

The Fotherington Insurance Group (TFIG : ISE), which started trading this week on the International Stock Exchange (ISE) issued a Mid-November dividend of L$0.01, recognizing that many investors have had their assets tied up in the IPO for most of the month.

Percy Fotherington, TFIG(ISE) CEO, stressed in the press release, "It is important that shareholders do not attempt to put sell orders on below net asset value (=L$1.00 today). Each evening I will review the sell orders and I will buyback sufficient shares to clear the excess demand at net asset value. Hence, selling shares below net asset value will result in an unnecessary loss to the seller."

As per the TFIG(ISE) prospectus, the company will operate a buyback policy when public shares in issue fall to a minimum of 15% of the share capital and to rise to a maximum of 30%. Public shares currently in issue are 27%. Therefore, the company will provide liquidity to the shares to allow investors to buy and sell at tighter spreads. Shares bought back will not be cancelled but held in treasury to be re-issued by the company as demand requires. The company will buy shares only at net asset value, and sell shares at the higher of net asset value or current demand in volume.

Under the 15% rule, management currently has capacity to buy back 71,000 shares.