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DiGi.Com Plans to Return Cash to Shareholders, Split Stock

DiGi.Com Bhd., Malaysia’s third-largest mobile phone operator, plans to return cash to shareholders including Norway’s Telanor ASA after receiving a 509 million-ringgit ($170 million) payment from a unit.

The company also said investors will receive 10 shares for each one they currently own in a proposed split to make the stock more affordable and boost liquidity, according to stock exchange filings today.

DiGi, 49-percent owned by Telenor will make the payment to shareholders by the first half of 2012 as it depreciates more than 1 billion ringgit of equipment and upgrades its network. The company, which reduced its second-quarter dividend to 30 sen from 35 sen a year earlier, in April said depreciation costs may hurt earnings for three years, prompting HSBC Holdings Plc and RHB Capital Bhd. to lower ratings on the stock.

“‘With this capital distribution, they are definitely paying out more than what they did last year,’’ Lim Tee Yang, an analyst at RHB, said by phone from Kuala Lumpur today. ‘‘The stock should move up a bit tomorrow.’’

DiGi’s shares, suspended since yesterday, have risen 27 percent this year, outperforming a 3.5 percent decline in the benchmark FTSE Bursa Malaysia KLCI Index.

DiGi Telecommunications Sdn., a wholly owned subsidiary, will undertake a capital management exercise to distribute 509 million ringgit to the parent. The parent then intends to return excess proceeds to shareholders by the first half of 2012, according to its filing.

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