Inco plans share discount in bid to raise equity capital

Hoping to raise more equity capital, Inco (TSE) will reinstate a 5% discount on common shares issued through an optional stock dividend program, and increase the limit shareholders may invest under its share purchase plan. Under the optional stock dividend program, which was subject to a 5% discount before 1989, shareholders can elect to receive common shares in lieu of a cash dividend. By reinstating the discount on Feb. 13, Inco hopes to rekindle participation in the program to pre-1989 levels of 20%. Participation currently averages about 7%.

Common shareholders will also be able to invest up to $12,000 or US$10,000 each quarter to purchase common shares at prevailing market prices. Inco says the increase, effective this quarter, is simply an adjustment to offset the declining purchasing power of the dollar and changes in the relative values of Canadian and U.S. dollars.

Both programs enable shareholders to acquire additional shares without brokerage commisions or service charges.

Equity raised through the changes will not be assigned to any specific project, said Inco spokesman Bob Purcell, but will be added to the general treasury.