Shares in Tavistock Investments plc (LON:TAVI) were up strongly early on after the wealth management firm said it was proposing an administrative rejig that would allow it to pay a dividend at some point in the future.
The company currently has negative distributable reserves, which is a legacy from the firm’s previous business, SocialGo.
The plan is to seek approval to use £23mln from the share premium account to wipe out the deficit.
“One of the company's stated objectives has been to introduce, and subsequently to manage, a dividend stream for the benefit of shareholders,” the firm said in a statement.
“Whilst there can be no certainty that a dividend will be paid, the board of Tavistock now considers it prudent to take the necessary steps to enable the company to pay a dividend if and when it is considered appropriate to do so.”
Reacting to the announcement, market makers pushed Tavistock shares 8% higher to 3.25p each.