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From the note I do not understand how the scrip dividend becomes a source of new finance since it just an offer in the form of cash or new shares … If it’s a new share , do the share holder still need to pay cash for the share issue ?
Normally one expects dividends to be in cash.
A scrip dividend is where the shareholders get given new shares instead of cash.
Therefore the company is paying out less cash and is retaining it – so they have more cash available to invest.
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