Rentech, Inc. (NYSE MKT: RTK) today announced that its Board of Directors has taken a series of actions in continuation of its program to optimize its balance sheet and maximize its after-tax returns. Specifically, the Company’s directors have:
- Declared a special one-time cash dividend of $0.19 per common share, which represents approximately $42.2 million in payments to holders of outstanding shares, representing a 14.6% yield on the Company’s share price at the beginning of this year, and a 6.6% yield based on the closing share price on Friday, December 7, 2012;
- Determined to redeem all of its 4.00% convertible senior notes on December 31, 2012. The notes, with principal amount of $57.5 million, are due to mature on April 15, 2013. The early redemption will result in interest savings of approximately $0.7 million and will be funded from the Company’s available cash; and
- Accelerated the decision timeline by which they will choose and implement the highest-value alternative for the Company’s technology portfolio, and they now expect to take such actions in the first quarter of 2013.
D. Hunt Ramsbottom, President and CEO of Rentech, said, “These steps, including the special cash dividend and early redemption of our convertible notes, which combined will return more than $100 million to shareholders and convertible note holders, reflect our commitment to find the best uses for our cash on hand and the cash generated by our majority ownership of Rentech Nitrogen Partners, L.P. While we have realized extraordinary gains in value for our shareholders, with a 121% year-to-date appreciation in our stock price and a 230% gain since we announced the IPO of Rentech Nitrogen in early August 2011, we remain committed to reviewing additional steps to enhance shareholder value. The special dividend and early redemption of our convertible notes also reflect our ongoing confidence in the strength of our financial future, and leave us well-positioned to implement our business plans.”