The Sunland Group Ltd (ASX: SDG) share price is certainly catching the eye on Tuesday.
At the time of writing, the ASX All Ords stock is down a whopping 92% to 7.7 cents.
Is this ASX All Ords stock really crashing over 90% today?
Firstly, your eyes are not deceiving you, this residential property development and construction company's shares really are down over 90% today.
However, the reason for the decline is not actually bad news. In fact, it could be classed as very good news for owners of this ASX All Ords stock.
That's because today is the day that its shares have traded ex-capital return. This means the rights to an upcoming return are now settled and new buyers of its shares will not be entitled to it.
What's going on?
In August, Sunland revealed plans to voluntarily delist from the Australian share market. It explained the rationale for the move as follows:
The directors of Sunland determined to adopt the Strategy of returning net assets to shareholders given that, at the time the Strategy was adopted, the price of Sunland's shares did not reflect the value of the underlying business. The Strategy is now nearing completion and is in its final phases with Sunland Group no longer having any active projects or developments or material business assets.
Essentially, management felt the company was undervalued and so decided to sell its assets, return the funds to shareholders, and then delist.
Capital return
Eligible shareholders can now look forward to receiving a 90 cents per share capital return next week on 1 November.
This represents a 94% yield based on where the ASX All Ords stock was trading at the close of play on Monday.
Sunland has applied to the ATO for a class ruling for Australian shareholders, seeking to confirm that no part of the proposed capital reduction will be treated as an unfranked dividend.
