Put on watch> Teekay Corp. ($TK)
$ 7.27 ▼ -10.22 (-58.43%)
Volume: 29,935,867
After HoursLast: $ 7.45 ▲ 0.18 (2.48%)


Teekay Corporation Sinks on 90% Dividend Cut
Teekay Corporation Sinks on 90% Dividend Cut
Teekay Corporation stock plummeted as the company slashed the quarterly dividend to 5.5 cents
Dec 17, 2015 at 11:31 am Est
Teekay Corporation Sinks on 90% Dividend Cut
Teekay Corporation Sinks on 90% Dividend Cut

By Larry Darrell on Dec 17, 2015 at 11:31 am Est

Teekay Corporation (NYSE:TK) stock lost more than 55% of its value today, as the company announced plans to reduce quarterly dividends by approximately 90% last evening. The company intends to distribute a 5.5-cent-per-share dividend in fourth quarter of fiscal 2015 (4QFY15), compared to 55 cents in 3QFY15.

The dividend reduction follows Teekay Offshore Partners’ (NYSE:TOO) and Teekay LNG Partners’ (NYSE:TGP) announcement that they plan to retain their internally-generated cash flows to fund future projects, and reduce the debt levels. Teekay Corporation mentioned that it remains committed to being a supportive sponsor for both master limited partnerships (MLPs).

Teekay Corporation CEO Peter Evensen commented: “Although it is painful in the short-term to have to temporarily reduce Teekay Corporation’s dividend, management and our Board of Directors believe Teekay and its shareholders will achieve greater long-term value.” The executive further stated that the long-term objectives can be achieved by enhancing value of the company’s ownership interests in Teekay Offshore and Teekay LNG.

At present, Teekay Corporation stock is trading down 58.89% at $7.19, as of 11:19 AM EST. More than 9 million shares have already exchanged hands today, compared to an average daily trading volume of around 900,000 shares.