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For the purpose of determining the allocation of the base cost of shareholdings between ordinary shares and B shares, the Directors consider that the market value of the shares at the close of business on 31 May 2017, the first day of trading after the issue of the B shares, was as follows:
Ordinary shares 425.0 pence
B shares 50.0 pence
As 5.15 B shares were issued for each ordinary share, the Directors consider that the appropriate base cost apportionment ratio between the ordinary shares and the B shares for CGT purposes is 62.27% to the ordinary shares and 37.73% to the B shares.
The following is an extract from Part V “United Kingdom Taxation” of the Circular dated 21 December 2016:
“For the purposes of CGT, the receipt of the B Shares will constitute a reorganisation of the share capital of the Company. Accordingly, the B Shares will be treated as the same asset as the Shareholder’s holding of existing Ordinary Shares, and as having been acquired at the same time as the Shareholder’s holding of existing Ordinary Shares was acquired. A Shareholder’s combined holding of Ordinary Shares and B Shares will have the same aggregate base cost as the Shareholder’s holding of Ordinary Shares immediately before the issue of B Shares. The aggregate base cost will be apportioned between the B Shares and the Ordinary Shares held by the Shareholder by reference to their respective market values on the first day of trading after the issue of B Shares. The apportionment ratio between the B Shares and Ordinary Shares will be published on the Company’s website at the earliest practicable time following a quotation or publication of a price or market valuation in respect of the Ordinary Shares following the issue of the B Shares.”
The full text of the Circular can be viewed here.