The venture capital heavyweight 3i - which is closing its long-established and successful Birmingham base - plans to return £500 million to its shareholders after a year when it sold earlier investments for £1.3 billion, realising capital profits of £260 million.
It re-invested £755 million, but chief executive Philip Yea said he did not wish to dilute 3i's performance by going for companies he would not otherwise consider attractive.
So shareholders will get special dividend of 40.7p costing some £250 million, on top of an ordinary final pay-out of 9.3p, making a total of 14.6p for the year, a 4.3 per cent increase.
Another £250 million is earmarked to buy back shares in the market, probably for more than the underlying asset value because 3i's shares normally trade at a premium.
Shareholders will have to approve the special dividend and share buy-back at a special meeting to be held after the annual meeting on July 6.
Yesterday the shares dipped 4p to 656p, 8.8 per cent above a net asset value of 603p at 3i's year-end on March 31, after a year when 3i delivered a total return of 15.9 per cent on initial shareholders' funds of £512 million.
Mr Yea said the decision to pull out of Birmingham was taken because the market for growth capital investments was now national and best met from London.
There was still a regional market for buy-outs. But buy-out teams in the southern part of the country tended to look to London for backing. Mr Yea felt that those further away from the capital could be better served from Manchester, because it is further from London than Birmingham.
"Our thinking was market driven," he said.
He stressed that 3i still employs more than 90 people at its office in Trinity Park alongside the National Exhibition Centre. They do a considerable amount of the group's IT, finance and purchasing work.
Investment executives covering a number of sectors where 3i is seeking to expand internationally are also based at Trinity Park. These include business services, food, media, general manufacturing, consumer goods and telecoms.
Mr Yea has re-structured 3i to focus on sectors rather than geographically.
"Sometimes it is easier to fly from Europe to Birmingham than to London, particularly when you are going to the NEC," he said.
" We have made good progress in the acceleration of 3i's development as a truly international private equity firm," he added.
"Despite the hesitancy apparent in the financial markets, I intend to report good progress towards our performance and strategic goals in the year ahead."
