In April 2005, Henderson Group completed the sale of the Life Services business for £1.070 billion. About £871 million was returned to shareholders in exchange for the cancellation of shares in May 2005. Shares were cancelled under two transactions. Under the Return of Cash transaction, all shareholders had 52% of their holding cancelled. Under the Reduction of Investor Base transaction, unless a shareholder opted out, up to 500 shares or CDIs were cancelled.
For more information on the sale of the Life Services business and these transactions, please see Notice of Meeting and Circular. The EGM took place on 21 February 2005.
The process
In line with the Return of Cash, shareholders received a cash payment in exchange for the cancellation of 52% of shares or CDIs held at 22 April 2005 (record date). Shareholders were paid at a rate of 55 pence per share (for CDI holders, A$1.345850 per CDI and NZ$ 1.438800 per CDI), which was the closing price for the shares on the London Stock Exchange on 16 December 2004 (the latest practicable date prior to the publication of the Notice of Meeting and Circular).
In line with the Reduction of Investor Base, shareholders who held fewer than 1,041 shares or CDIs on the record date (22 April 2005), and therefore held fewer than 500 shares or CDIs after the Return of Cash, received a cash payment for the cancellation of all their shares or CDIs. Shareholders were paid at a rate of 64 pence per share (for CDI holders, A$1.566080 per CDI and NZ$1.674240 per CDI), calculated using the average closing price on the London Stock Exchange for the 20 business days immediately prior to the record date (22 April 2005), plus a 5% premium. Shareholders had the option to opt out of the Reduction of Investor Base, and those who made this election retained 48% of their holding.
A cheque for the proceeds of the Return of Cash and Reduction of Investor Base was issued and mailed to shareholders on 6 May 2005. If you were a Henderson Group shareholder at the record date (22 April 2005) and did not receive your cheque, please contact the Henderson Group Share Registry.
Taxation
Information about the tax implications of the Return of Cash and Reduction of Investor Base for UK, Australian and New Zealand residents, were set out in the Notice of Meeting and Circular.
On 13 July 2005, the Australian Taxation Office (ATO) released a final class ruling in relation to the Return of Cash and the Reduction of Investor Base transactions. The ATO also issued a fact sheet to help individual shareholders to calculate their capital loss (or capital gain) and complete the capital gains question in their 2005 tax return.
The Inland Revenue Department (IRD) issued a statement with the confirmation of tax implications for New Zealand shareholders.
If you have any questions about the Return of Cash and Reduction of Investor Base, please contact the Henderson Group Share Registry.