Equity
BWG Homes’ equity capital as at 31 December 2009 totalled NOK 1 713.5 million, corresponding to an equity ratio of 39.8 per cent. BWG Homes must maintain a level of equity that is reasonable in relation to the company’s object, strategy and risk profile.
Dividend policy
BWG Homes seeks to pay its shareholders an annual dividend of 50 to 70 per cent of profit after tax. A dividend is proposed if in the Board’s view it will not have an adverse impact on BWG Homes’ Group’s future growth ambitions or capital structure. The company’s dividend policy is discussed in the annual report and on the company’s website.
The Board wants to give priority to repayment of long-term liabilities ahead of paying a dividend for fiscal year 2009.
Capital increase
The Board will only propose a share capital increase if it is in the long-term interests of all shareholders. Existing shareholders will normally have pre-emptive allocation or subscription rights in any significant share issues. The Board may – in accordance with the Public Limited Com-panies Act § 10–5 – decide to waive existing shareholders pre-emptive rights when special reasons indicate that this is the company’s and shareholders’ common interest.
In February 2009 the Board executed a private placement of shares and a subsequent repair issue was executed in March. Existing shareholders not being offered to participate in the private placement, received pre-emptive allocation rights in the subsequent repair issue at the same terms and pricing as in the private placement.
The Board’s share issue mandates are normally confined to specific purposes. At 31 December 2009, the Board had one share issue mandate which is valid until the 2010 meeting.
On 6 March 2009 the Board was authorised by the Extraordinary General Meeting to increase the company’s share capital with NOK 30 million. The mandate covers only capital increase against cash deposits, and does cover resolution on mergers in accordance with section 13–5 of the Norwegian Public Limited Liability Companies Act. As distinct from what is recommended in the Code of Practice, this mandate is not dedicated to a specific purpose. The Board considers that it is in the best interest of the company that the Board has flexibility in this respect.