| |
|
 |
|
 |
| Base cost apportionment - 1997 |
Q. What proportion of the cost of the original underlying ordinary shares will be apportioned to the new ordinary shares and the B shares respectively?
A. Shareholders who held shares at the time of the capital reorganisation in 1997 may need to determine the effect of the 1997 capital reorganisation on the base cost of their current ordinary shares for tax purposes. Shareholders' base cost in their pre-1997 capital reorganisation shares should be apportioned between the new ordinary shares and the B shares created as a result of the 1997 capital reorganisation by reference to their respective market values on the first day on which they were listed (which was 3 March 1997).
The company cannot give specific advice to shareholders in respect of their tax position, and shareholders are encouraged to seek their own advice. However, the company has carried out an assessment of the market values of the new ordinary shares and the B shares (which were created as a result of the 1997 capital reorganisation) on 3 March 1997. For each existing ordinary share held at 1997, shareholders received 1.8 new ordinary shares and two B shares. The market value of each new ordinary share was 355p and the market value of each B share was 36p. Based on reference to the Stock Exchange Daily Official List, 89.82% of the base cost in the pre-1997 capital reorganisation ordinary shares can be apportioned to the new ordinary shares created at that time, and 10.18 % of the base cost in the original ordinary shares can be apportioned to the B shares created at that time. (The two figures should add up to the amount of the base cost in the original ordinary shares).
Please note that this information is for guidance only and independent tax advice should be sought in each case.
|
| |
|
|
