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Leas
Great question, according to the Wicked website it was started by 2 entrepreneurs from US (wicked llc) but "partnered" with Tesco, read in to that what you want, but one of the founders is "execurive chef & director of plant foods innovation" for Tesco and came from Wholefoods.
Not sure if that makes it any clearer or not....
thanks
I don’t think it will be as bad as some think.
I suspect a 1:10 ish split
I think there’s an update on Monday
Does anyone know how the consolidation is going to work out ? Can't find anything about it .
Thanks longterminvestor. The tax situation certainly is a worry as effectively some of us could be worse off? Will have to wait and see exactly what happens? The reduction is share numbers after the consolidation will help with future dividends?
Any investor or colleague of TSCO know if their Wicked range is manufactured by the company or by a food producer in collaboration?
My research so far suggests it’s ‘in house’ I have an investment with a US company but looking to add a European Producer. The Wicked range is doing very well for TSCO and could be pivotal in bringing back some of the customers lost to Lidl and Aldi.
One thing for sure . The UK tax system will be very different very soon. To some degree I do see it as a return of capital rather than a special dividend. The sale of the Asia businesses was not for profit but to cut losses and contradicts the definition of a dividend.
Anyway no point in losing any sleep. Always sell if it did.
£8m trade today at just above the bud. 2.4206, reported as a sell. Do me a favour, even with liquidity you wouldn’t be able to negotiate that price for that volume:)
Indeed it does say "return of capital"
Well, I'm interested to see how it works. Although my Tesco is in an Isa so it doesn't matter either way.
gg
''so not sure what your point is here?''
The difference between a capital gain/loss or income tax to be paid
Sale of Thailand and Malaysia businesses approved by shareholders in May, regulatory approval and completion of sale expected in 2H 2020; to be followed immediately by shareholder meeting to approve the return of capital
https://www.tescoplc.com/news/2020/interim-results-202021/
reduction in share capital
Either way, invest 240k and 50k is coming back to you so not sure what your point is here?
I can't get my head round how a capital repayment would work. I assume the capital isn't coming out of retained earnings or its a normal dividend. So that leaves share account and share premium, which is less than 6bn in total, so no way they'd return 5bn through this.
Is there a tax accountant around?
Anyone thinking of purchasing £240,000 pounds worth of Tesco shares tomorrow so that you can shortly get back £50,000 of your capital, or would you be looking forward to £50,000 income.
https://www.lse.co.uk/rns/VEC/proposed-special-dividend-and-share-consolidation-32t2rnpzj72zh3o.html
gg
''You should treat it as dividend income as that is what it is. ''
As well as an income dividend, capital can be returned via a special dividend (capital dividend)
oops meant to say ....sell before ex dividend
ggplyr...well, I am torn ...I have been hoping there will be a surge into the 50`s before ex divi in Feb....no such luck..so far .
Am hanging on to see what the circular says re consolidation ratio.on 26th Jan .Then it will be decision time.My plan had always been to sell ex dividend .Time will tell.
Nigella- if you think your break even point goes to 2.94 why haven't you sold now at 2.42?
£2.86 target raise from Berenberg today ....little or no effect !!
share consolidations are not liked.check what your new break even will be on the cash invested in Tesco shares, when you have lost 20% of your holding through consolidation. my b/e goes up from £2.35 to £2.94
ggplyr
Fully agree, fundamentals completely different. Of course that will change again after any share consolidation which I think some investors fail to take into consideration.
I doubt you are comparing quite what you think you are comparing, the price of a share of one company vs the price of a share of another company isn't overly comparable. Although their relative movement is which is what you are implying.
Sainsburys has net assets of 7.8bn, it has a market cap of of 5.5bn. if it sold all all its assets and settled all its liabilities then in theory share holders would be better off than they are now.
whereas tescos net assets is 13bn (half of which are intangible), & has a market cap of 24bn.
Looking at this alone implies sainsburys is undervalued vs tesco.
Although tesco has a much better p/e ratio
(analysis only done on full year accounts which are coming up to a year old for both companies)
chris
I think the SD is a significant factor and imo the current trading range is under control and influence of the institutions. These algo trades prevent the sp falling too much thereby keeping a lid on demand. The algo trades also prevent the price rising above the current level so that institutions can load up on the cheap. Over £20m of shares were bought yesterday and I would be surprised if the same is not occurring today.
I also think SBRY notice of intent to sell its bank to Nationwide is seen as a positive by the market and allow the company to be more focused on its core business.
Not forgetting Argos that is now fully established in its stores with costs savings going forward with high street store closures.
Shore Capital has also been very vocal on pushing forward SBRY to institutions despite director sells last year.
If you have the luxury of time later this afternoon then have a look at the trades reported at 5.30pm. The current tight trading range makes it easier to determine whether or not they are buys or sells.
All my opinion......
Many companies will issue special dividends, some almost yearly. These are treated as ordinary dividends. With the sale of the Asia businesses, there are two elements. The first is the return of the asset value and the second is the profit made on the sale. One is simply a return of your original money (asset value), the second is the balance (the profit).
I have looked at the circular but can't remember seeing anything about tax implications. I would certainly expect the profit element to be subject to tax. I have surfed the web extensively and can't find anything UK based which is sensible, not even on HMRC web site. I have also written to various TSCO Directors regarding this.