Diversified Energy Share Discussion Threads

[drradcliffe] 19/11/2023 18:22

@wilmwherk it's unfortunate because if it's a US stock that is not listed on London Lloyds/Halifax take 15% withholding tax (assuming you've signed the W8-BEN) but if it's a UK listed US stock they take 30%. This means a stock like Somero = 30% withholding; Microsoft = 15% withholding within an ISA. Obviously I'm hoping DEC will de-list from London. I should really move everything out of Halifax/Lloyds but it's a load of hassle.

From the Lloyds/Halifax websites:

"Ordinarily if you complete a W-8BEN form you will only pay the 15% Withholding Tax rate instead of 30% on US listed shares paying US sourced dividends. For UK listed shares paying US sourced dividends a 30% Withholding Tax rate is applied even if you have a W-8BEN form in place.

For example, you would receive $70 on a $100 dividend."

I don't know why they do this! Reading AJ Bell's T&C's they say they don't offer a foreign withholding tax reclaim service, but for US investments (presumably bought from a US exchange they do offer the 15% withholding discount) so it sounds like Halifax and AJ Bell treat London listed US stocks in the same way for trading ISA accounts.

[wllmherk] 19/11/2023 14:17

I'm with Halifax share dealing and they sent me a W8-BEN form which I completed and returned, only to be told they don't provide the tax rebate. That was earlier this year.

wllm :)

[imnotspartacus] 19/11/2023 08:30

They do now accept the W8ben form so I’m expecting the discount. You can download it from the iWeb site.

[aishah] 18/11/2023 23:34

APPL should do a 10-1 consolidation to get to the top of the tree then!!

[scubadiverr] 18/11/2023 19:58

Is anyone holding this via iweb, and if so, what deductions are made from the dividend? TIA

[1knocker] 18/11/2023 17:12

I have to put my hands up and admit I did not know that aleman. Amazing (frightening?) the technical facts which can pass one by! Just as well I don't buy or trade indeces.

[laurence llewelyn binliner] 18/11/2023 13:25

#Aleman, thanks for that intel, very interesting, we will see how it pans out when the listing goes live 5/11th December, not long to wait either..

A 20:1 consolidation here could result in GBP20 PDQ with some healthy US interest pull, the 20% yield surely has to be attractive to bag now in advance does it not, why wait..?

[sogoesit] 18/11/2023 12:54

NYSE initial listing rules is a $4- share price minimum.
Allowing for a margin for the stock to go to 50p or below (to keep listed) a 1:20 is no big deal.

Read all about it...

[aleman] 17/11/2023 20:58

The absurd US affection with high share prices is because the Dow is weighted by share price and not market cap so low share prices and the low weightings they bring are superficially linked to inferiority. Penny stocks will occasionally be assumed to be basket cases and overlooked by some. Note how heaviest-weighted UNH has about 3 times the weighting of APPL because its share price is 3 times as high - even though the APPL market cap is 6 times higher. It's a nonsense of an index yet many people, especially outside the USA, are unaware of its anachronism.

[mattybuoy] 17/11/2023 19:31

North Americans are obsessed with the number of shares out. It doesn't matter if it makes any sense or not it's the way it is.

[1knocker] 17/11/2023 17:38

The share consolidation sounds rather extreme? I don't know the figures to avoid US penny share status, but surely a 1 for 20 consolidation is far more than necessary? I hope they are not calculating for a fall i the share price !!

It certainly won't help theSP here. Its mad, but the accepted wisdom is that there is a better market for 50 shares at a pound a pop than for 1 at £50, even though they represent the same proportion of the value of the company and pay the same % dividend. Given that most shares are held by institutional holders, and presumably even amongst PIs there are few who buy or sell50 quid's worth at a time, or indeed are embarrassed by pitching buys and sell at multiples of fifty quid, this has always surprised me.

surely at a share price of less than a couple of hundred pounds it should make no odds? Do folks really feel a warm glow looking at the number of shares in a company they own, rather than the value of the holding?

I suppose a lowish price is handy for companies running dividend reinvestment and scrip dividend schemes, but that is the only practical consideration I can think of. The price of a share does not seem to have held Berkshire Hatherway back unduly!

Psychology, I suppose. Nowt so strange as folks.

[mattybuoy] 17/11/2023 15:43

I have not seen a US O&G stock with a yield over 12%, so assuming the company isn't going bankrupt (and the stateside instis become convinced of this) it should slowly correct upwards purely based on that.

You can see bigger O&G yields on the NYSE but these are attached to things like Petrobras and Ecopetrol i.e. Latin American NOCs etc.

[this_is_me] 17/11/2023 14:14

1 million shares is hardly a lot. They would need to do that regularly to make a big difference.

I don't see why it can't double from here, particularly if the buy backs continue.

[mattybuoy] 17/11/2023 12:07

This has to re-rate once it arrives on the NYSE. I wouldn't expect anything too drastic but hopefully 100p equivalant can be achieved again. That would equate to about $18 post-split.

[aleman] 17/11/2023 10:11

I notice volume picked up as shares rose yesterday after 2pm. Could US investors be starting to buy the stock ahead of the US listing? Any shares bought will convert and be freely tradable in New York in a few weeks. Why wait until then?

[fordtin] 17/11/2023 08:10

Re “the Board and management consulted with their advisors, along with various US and UK institutional investors”

Would the “various US and UK institutional investors” have been restricted from trading in DEC during this consultation period?
If so, would DEC also have been restricted from buyback’s during the consultation period?

It might explain the withdrawal from buybacks between 30th October and the listing announcement.

[laurence llewelyn binliner] 17/11/2023 07:14

1M shares bought back at 72 pence yesterday, I was not expecting the BB to be continued following the US listing announcement, but should that keep going, it can only add to the EPS/DPS and share price post admission to the NYSE... :o)

[justiceforthemany] 16/11/2023 22:28

Agree 100%, share price should rise; lots of demand from US investors for a 20% yield!

[justiceforthemany] 16/11/2023 22:27

Diversified has announced that it intends to seek an additional listing of the Company’s Ordinary Shares on the New York Stock Exchange (the “NYSE”) (the “US Listing”). No new Ordinary Shares are being offered or sold in connection with the US Listing, and there will be no change in the total issued share capital of the Company following the US Listing.

I have put the entire DEC announcement in below as it contains a great deal of technical listing data. But the key point is that readers know that the previous plan to list in the US was pulled after company brokers detected a worry that such a listing would inevitably come with a raise that would affect demand for the shares and thus it is crucial that this listing is going ahead with no raise attached to it.

I have spoken to Rusty Hutson about this and he believes, as do I, that it will significantly advantage DEC for it to be listed in the USA. The shares will be fungible and accordingly make it attractive to hold the shares in either jurisdiction. More importantly I think that US investors will like this and I would not be surprised to see a decent amount of demand drag on the shares in a westerly direction.

[valuehurts] 16/11/2023 22:15

As a UK taxpayer you will always have 30 percent withholding tax unless you have a w8Ben in place which reduces the withholding to 15 percent. There are no withholding taxes if you hold a US position in a SIPP.

[marksp2011] 16/11/2023 13:15

The problem with share consolidations is that it changes the risk/reward ratio for shorters - I can't think of a situation where a consolidation when the share price is weak has been a good plan

[carcosa] 16/11/2023 13:15

Some readers may wish to avail themselves of the 274 page Form 37-F (basically equivalent to a UK admission document) which is available on DEC's and SEC's websites.

Some interesting items include discussion regarding the BLM Proposed Onshore Oil and Gas Leasing Rule, Inflation Reduction Act associated costs from 2024, the SEC’s proposed climate rule (now that we are going to listed in the US).

Also interesting to note that in a high price environment they may lose the ability to process natural gas. Delays in the progress of additional third party processing infrastructure is unwanted.

Anyway, these types of declarations discuss every risk, however unlikely, in some detail but there is certainly a voluminous amount of info to plow through for those that want to DYOR.