Aker Solutions to Consider Dividends, Buybacks After Asset Sales
Aker Solutions (AKSO), the Norwegian oil-services company, will consider its dividend level and possible share buybacks in the “longer term” after selling 5.4 billion kroner ($882.8 million) of assets.
“In the short term we will reduce the level of debt,” Executive Chairman Oeyvind Eriksen said in a presentation in Oslo today. In the longer term, the company will examine “not only how to build Aker Solutions going forward, but we will also consider share buy backs and the level of dividends.”
Aker Solutions, controlled by billionaire Kjell Inge Roekke, has sold its mooring and loading systems unit and its well-intervention services operations as it seeks to streamline its business and improve profitability. Roekke’s Aker ASA (AKER) holding company has since increased its stake in Aker Solutions in a move seen by some analysts as a signal the company will pay a special dividend.
“As of today, the key message is that the dividend policy is unchanged and we have enhanced financial flexibility,” Eriksen said, without providing further detail. Eriksen is also Aker’s chief executive officer.
“Dividends are proposed by the Aker Solutions board and this will be communicated in connection with the fourth-quarter results,” spokeswoman Bunny Nooryani said in an e-mail on Nov. 27. The sale proceeds “will among other things be spent on investments in our core activities and repayment of debt.”
Aker Solutions aims to pay out 30 percent to 50 percent of net income through cash dividends and share buybacks, the company said in presentation material released ahead of its capital markets day in Oslo today.
The company, which last announced an extraordinary dividend in 2006 after the sale of its pulping and paper unit, made annual payments of 4 kroner for 2012 and 3.9 kroner for 2011. Investors will probably see annual dividends of 3 kroner, 4 kroner and 5 kroner for 2013, 2014 and 2015 respectively, according to Bloomberg dividend forecasts.
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