UIL Set to Go Private Amidst Challenges in Liquidity and Diversification

On October 8, 2024, UIL Limited (UIL) announced plans to take the company private following the redemption of its 2028 zero dividend preference (ZDP) shares. Despite possessing promising investments, UIL's recent performance has been underwhelming, leading to a lack of portfolio diversification. Furthermore, UIL has struggled with limited liquidity in its ordinary shares, accompanied by a broad investment mandate that has fallen out of favor with investors.

As a result, UIL's board decided to privatize the company and cancel its stock exchange listings. Until the ZDP shares are redeemed, the annual dividend of 8.0p per share will continue, barring unforeseen circumstances. Edison Investment Research detailed these developments in its latest report.