Confused by A&L takeover and what has happened with my shares

indierocker85

I inherited shares in A&L when my grandfather passed on. I sold 450 of them when they were very high priced. I had 50 remaining, which due to the current economic crisi, I left alone. Now this morning I got a letter from Santander stating the following.

"Dear Shareholder

It is a great pleasure to welcome you to the Santander Group

Santander has a sucessful history in retail banking with over 80 million customers and a presence in over 40 countries. The group already has a strong presence in the UK through its Ownsership of Abbey and more recently, Bradford and Bingley savings business and branches. The addition of Alliance and Leicster (A&L) will further strengthn our UK position.

In these turbulent financial times, it is reasurring to know that Santander is one of the few banks to have come through the last year unaffected by high risk operations. Our strict and prudent risk management, together with our relentless focus on retail banking, has served us well and gives the bank a low and predictable risk profile.

In welcoming you as a Santander share holder, I want to reassure you that we have a long established culture of looking after all our retail shareholders. Around 1.3 million former Abbey Shareholders already benefit from being a part of Santander, and this is no smallmeasure due to the dedicated and active Shareholder Department we have in London. We are looking forward to providing you with the same benefits that our other UK shareholders receive.

Enclosed with this letter you will find your entitlement statement showing your shareholding and a welcome booklet. On the 3rd of November we will pay the 2nd dividend of the financial year 2008

I am convinced that Abbey, Alliance & Leicster and Bradford & Bingley, as part of the Santander Group, will be an even greater force in UK banking that you can trust to look after your money and take care of you as a shareholder. We are in excellen shape to continue creating value for all our shareholders.



Included with this is an "Opening entitlement statement"

Dated 14th October
Description = Opening Balance
Transaction Amount = 16 (Where are the other 34 shares?)

At the bottom it says Total number of Banco Santander Shares = 16
With an indicative value of £128.64

I am therefore wondering where the other 34 shares are, as inclusive to this I received a cheque from Santander for £5.41 titled Santander Fraction Payment

To the left it says

About your statement
This is your statement in respect of your Banco Santander shares in the Santander UK nominee (formerly the ShareSafe nominee)

Statement period
14th october

Indicative Value
The indicative value given is only intended as an indication of the current value of your holding. This is not necessarily the actual amount you will get if you sell your shares. the indicative value given on this statement is based on a Banco Santander share price of

£8.04 which was the closing price on 14th October 2008

CAN ANYBODY SHED ANY LIGHT ON ANY OF THIS, PARTICUARLY WHERE HAVE MY OTHER 34 SHARES DISSAPEARED TO. I HAVE SELDOM BOTHERED WITH THESE. AND THUS I AM EASILY CONFUSED. ANY ADVICE OR INFORMATION WOULD BE GREAT.

THANK YOU IN ADVANCE

MrExample

The A&L shares were valued at less than the Santander ones, therefore when they were converted, you end up with fewer, but the overall value should be the same. The cheque value presumably represents the remainder after the conversion (since you can't ordinarily own fractions of shares).

Lansdowne

One Santander share is worth 3 A&L shares. Therefore the 16 Santander shares represent your original 48 A&L shares, and the £5.40 is the value of the 2 left over which can't be converted.

indierocker85

So what was the value of 1 A&L share before the transfer? As if one santander share is now equalling £8.04 (at close) then A&L shares must have really plummeted.

MrExample

Santander, from what I can tell, offered 317p per share (299p + 18p dividend). The price when the offer was made was 219.25p.