Galahad Gold Share Discussion Threads

[nigelsom] 24/1/2008 12:19

Alan - thanks for that: it rather suggests that the dividend version of payment is therefore 16.5p plus a tax credit of 10%. Kind of what I was thinking, but good to get one's foggy mind clear on such matters!

\nigel

[badtime] 24/1/2008 10:07

No swede :)

[pomp circumstance] 24/1/2008 10:05

wasnt tax paid in turnips back then?

[alanji] 24/1/2008 09:48

There is no tax penalty to the company - it pays advance corporation tax on the dividend and it is set against its final tax liability when agreed. At least it used to be when I was a tax expert!!

[nigelsom] 23/1/2008 20:32

Hi all - been having a read through the comments re option A, B and C. With specific reference to option A, I wonder if anyone can confirm whether this is 16.5p gross or net? I've not found anything in the documentation so I wonder if it is gross and thus those with these shares in a SIPP could be heading for a 10% tax loss. I know the documents say 16.5p, but it seems to me a bit unfair for the company to pay some peoples tax and not others! Any ideas?

Cheers,
Nigel

[badtime] 23/1/2008 19:59

Sky...nt sure if tilts is bak from his jolly in switzerland yet :)

[skyship] 23/1/2008 10:41

TILTS - Managed to by two lots of 25k yesterday @ 17.36p; but today can't even get a quote - are the mms shutting up shop early? Oh - & were all those trades yesterday sales, or were you hoovering up more stock @ commendably low prices - good dealing if so!

[skyship] 21/1/2008 16:42

TILTS - True, I recall we had to wait ages for the final LNT payout.

Nearly bt more @ 17.4p today - but decided I may need the cash for some of the tempting bargains now appearing all over the place......

[tonytravel] 21/1/2008 12:13

nfranks,

many thanks for clarification - much appreciated.
tt

[steve36] 21/1/2008 09:08

Skyship, most likely circumstance that I can think of is if for some reason the liquidation is more complex or takes longer than expected, then fees may eat into the cash pile. Alternatively, if the tax bill is bigger than estimated. I assume the reason why the final payout will not be until 2009 is to see if any additional money is due on the Northern Dynasty sale, although that is unlikely. Even without that though, liquidation is a long drawn out process.

[skyship] 21/1/2008 09:01

Tiltonboy - in exactly what circumstances might the balance not be paid. I can't think of any realistic obstacle.

[tiltonboy] 19/1/2008 11:14

nfranks,

The balance of the money is by no means a certainty, though I do expect it to be paid. The other issue is that you may have to wait another 12/18 months for it.

At 17p it stacks up, at 17.5p it is just that bit more of a risk.

tiltonboy

[nfranks] 19/1/2008 10:18

Tiltonboy - Thanks, my shares are in a halifax nominee account so I haven't actually received the full document so didn't know about that good news.

Begs the question should I be buying more of these at 17.5p if the shares are going to be worth 18.87p plus 0.45p interest?

[tiltonboy] 18/1/2008 22:49

Interest on the cash deposits. It's in the document.

[nfranks] 18/1/2008 20:57

what other 0.48p?

[tiltonboy] 18/1/2008 19:10

nfranks,

You forgot the other 0.48p.

tiltonboy

[nfranks] 18/1/2008 17:47

tonytravel - the share price is estimated (at time circular was sent) to be 18.87 pence not 16.5p (could actually sell at the moment for 17p)

The 16.5p is the value of the new A, B or C share, which option you take depends on your tax situation.

The new share will be worth 2.37p which we'll get when the company eventually gets wound up, but could be more.

"On the basis of the estimated net asset value of 18.87 pence per Existing Ordinary share the remaining 2.37 pence per Existing Ordinary share (together with any additional amount available for distribution to shareholders) will be distributed following the discharge of all of the Company's liabilities and the release by the Liquidators of any capital retentions required by them. The Directors anticipate such distribution could be made in the first half of 2009."

Is this 2009 is another typo ????? seems a long way away!!!!!

So to answer your question what you miss out on if you sell now (for 17p) is 2.37p+ per share, about 9.9% of the valve of your holding. (if my dodgy maths is correct)

What I find difficult to understand is why people aren't buying at 17.5p to get 18.87p when it's all done and dusted, an increase of about 4.9%. Minus dealings costs and stamp duty probably some risk that the final payment won't be 2.37p I assume. Perhaps the final payment of 2.37p will be in 2009 so folks don't want to wait that long.

Of course I may be wrong with my workings out!!!!!!

[tonytravel] 18/1/2008 12:20

I`m new to this game, please forgive me but this seems awfully complicated, please advise ..
If the share price is 16.5p why not just sell now ?
What do we miss out on ?

[renew] 18/1/2008 11:42

If the shares are held in a SIPP if optoin A is taken (ie dividend) will the 10% withholding tax occur and if so am I correct in assuming that it cannot be reclaimed?

[skyship] 17/1/2008 16:05

17.288p BID - so that's the end of the cheap stock once and for all!! Pity - wanted a few more.

[sharpshare] 17/1/2008 11:10

Thanks all for your comments regarding the tax analysis.

[steve36] 16/1/2008 17:58

Sharpshare, I agree with your analysis

The base cost of shares has to be apportioned between the A/B/C shares and ongoing ordinary shares by reference to the market value of the shares at the time of the reorg. The value of the A/B/C shares should each be 16.5p, given the imminent payout. The value of the ords would normally be taken from the quoted price on the first day after the reog but as they will not be listed it will have to be imputed from the last price. So, if the share price is 17.5p on suspension, the apportionment should be 16.5/(17.5) to the A/B/C shares and 1/17.5 to the ongoing ords.

The final liquidation payout will be compared to the base cost of the ongoing ordinary shares, 1p in the example, giving rise to a gain or loss at that time.

I agree that it should be possible to make a negligible value claim and claim a capital loss in respect of the base cost attributable to the A Shares once the div is paid, ie in respect of this tax yr.

The gain on disposal of B Shares will arise in this tax year, but note that business asset taper relief is not available even though GLA is quoted on AIM because it is an investment company. Gain on disposal of C Shares is in next tax year, at 18% if the proposed CGT changes go through. Both of course subject to availability of annual exemption. SIPP holders have it easy!