Vodafone

Hugeass304

Does anyone know what happened to Vodafone shares recently, I now seem to have less ordinary shares and have gained some preference shares. I have contacted Halifax Sharedealing and they say they sent me an email where I had to choose what to do about the preference shares. I don't think I received any such email and can't help thinking i've dipped out here

johnmoney05

Every 8 Existing ordinary shares will be consolidated into 7 new oridinary shares and 8 B shares.

If you didn't make your choice, my guess will be that Halifax will opt for initial redemption. So all your B shares will be redeemed at 15p per share. So you will receive your money soon.

Murtle

As per the above post, it is due to the decision to give money back to the shareholders from the sale of Vodafones share in Japan.

Hugeass304

Does that mean the price of the 7 new shares should rise so that they equal the value of the 8 old shares, otherwise it just looks like an enforced sale of 15% ish of the original holding

derrick

Hugeass304 wrote:

Does that mean the price of the 7 new shares should rise so that they equal the value of the 8 old shares, otherwise it just looks like an enforced sale of 15% ish of the original holding

That is what happens, I have had it done several times over the years, they say they are giving money back to shareholders, but in reality when you add up your new share allocation and the new ordinary shares or cheque, you will be no better off, just have less shares and like you say,it is an enforced sale of some of your original shares.

Hugeass304

I was a bit peed off that Halifax share dealing didn't give me proper notification that this was going to happen, they say they sent me an email telling me to look under corporate actions but I don't remember seeing this. I'd have thought there would have been more about it in the press as well. I suppose this is the price you pay for lodging certificates with one of the stock brokers rather than hold the certificates yourself

steady__eddie

Barclays sent me some spiel, the bit that caught my eye was, "The proceeds for the initial redemption are expected to be paid by Vodafone on 11 August 2006. We will credit your account within 5 Business days of receiving the proceeds".
5 Business days for Barclays to clear a payment ? that's par for the course I suppose.

derrick

This is classed as a “Capital Repayment” however I think it is robbing us of our money, take my own example:-

I had 3014 shares, I now have 2637, a “loss of 377”, the price on the day was 126p per share.
3014 x 126 = £3797.64
2637 x 126 = £3322.62
Lost, £475.02

I also now have 377 shares at 15p = £55.65
£475.02 - £55.65 = £419.37 LOST MONEY

So how these people can say they are returning money to shareholders when the opposite is blatantly clear is beyond me. They have forcibly sold shares at a massive knockdown price.

Is there anything that can be done to recoup the losses?

Murtle

Hi Derrick

I'm not sure that your calculations are correct Derrick you should have as per the original post

Every 8 Existing ordinary shares = 7 new oridinary shares + 8 B shares.

Therefore, if you had 3014 original you will have 2637 ordinary shares + 3014 b shares which will be paid out at 15 pence each.

I can't find anywhere that the share price has been anywhere near that price since the end of may start of June, but there is the possibility it may have jumped to that price on the day and then dropped back to it's -120p value. (the value of 8*15p=120p)

From memory there were options you could choose, did you not choose the option you wanted??

Murtle

derrick

Hi Murtle,

I did not get the options as the shares are held in a nominee acc,(bad choice), and they only put the info on the website which I do not visit very often, I did think the way you suggest, that the total value would be the same,as I said in my post above#5,however I did phone the nominee people yesterday,(Squaregain), and they did say my calcs are correct, but I will phone today the registrars and the FSA because whatever the outcome, there is definantely no advantage to shareholders, it is just an enforced sale of X amount of shares, at a greatly deflated price due to the share price at the moment.
Re the price I have used,126p, I was told by Squaregain that was the price on the day of the share consilidation, however it realy does not matter to much for this purpose as the price will be pro rata anyway.

cheerfulcat

derrick, Murtle's right, you should have 3014 " B " shares which would make you nearly even. There is some further discussion on the Motley Fool Vodafone board.