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I dont think anyone on this board has ever suggested that.
Whatever a company gives a special dividend basically its giving you the shareholder part of your investment back ,You'll end up no richer no poorer. Don't think for one minute you'll make an easy 40-50p per share. DYOR
'purchases reported after the bell'.....
Nigella
It is a good thing, the company is trying to restructure debt repayments at a lower interest rate and should be well received. Interest rates on debt is likely to be negative or very low for decades to come and the company is currently paying an average of over 5% on its current loans.
I am no accountant but I can only guess that the debt repayments offset tax liabilities. You have to question why the money from the Asia sales was not used to offset some of the debt but going forward the company will be paying less costs for that debt not forgetting the lower Pension fund payments.
Judging by the large purchases after the bell the last couple of weeks 'the city' must see it as a positive move even though we are currently stuck in the doldrums. Following link may be of some help.
https://www.investopedia.com/terms/d/debt-tender-offer.asp
How helpful saved them a trip all the way to page 6 ..rolls eyes
Thankyou
Spar i had a quick look at this but this payment is in conjunction with a share consolidation, a few bells and whistles attached so the extra 50p might be lost in the transaction.
Spar, don't worry about him, you have to be on the share register by 11th Feb.
Jesse Livermore: " The game of speculation is the most uniformly fascinating game in the world. But it is not a game for the stupid, the mentally lazy, the person of inferior emotional balance, or the get-rich-quick adventurer. They will die poor.
And I can assure you I have chewed myself out numerous times for my fails
I mean i found the answer in less than 10 seconds on page 6 of one of many. I do wish PI's would make the effort to read back on the thread dicussion or at least understand you are eligible for a dividend until a share goes ex dividend.
How many more times for this question ?
If I buy shares in Tesco would I be entitled to the special dividend? Is there a cut off date set for shareholders to get this payment?
This is an area I know little about. I suspect LTI will know more about this. My understanding is that these are to raise monies to repay earlier loans which are reaching maturity.
Would I be right in thinking that you are wondering why monies from the Asia businesses are not being used to reduce the debt? Also, does the interest rate indicate future mainstream interest rates?
Can anyone shed any light on the good , bad or indifferent effect of the "Tender notes offer" announced on 19th Jan ....(price to be determined on 28th Jan )
The purpose is to ;, in their words, Strengthen the balance sheet.
I have not had any time to look but, from memory, the original circular mentioned that the sale represented something like eight times EBITDA. The multiple was stated but can't remember
Agreed. A return of capital is preferred however, that was not put before shareholders in the original meeting as far as I am aware. It may be that the circular for Monday will give guidance and then voted upon. All of mine are in an ISA so won't affect me. My major concern is that if consolidation is more than keeping the share price as now e.g. to take the so to £3, £4 or £5 that we still get the price per share in our SAYE plans. A nice bonus
RW
I have already said that a special dividend can be used as the vehicle to make a return of capital payment.
Jaff
The original meeting voted for a special dividend and not a return of capital. Hope you are right though
I would expect a 'Capital Return' as the sale is a capital transaction, dividends are paid from the business income stream. Any funds from realisation of the asset not returned to shareholders will be deployed for the benefit of said shareholders i.e. through the business strategy going forward. Let's see what the BoD are up to.
I hope Monday`s announcement will reveal that TSCO have decided to re-name the payment as "Capital Return" , this would boost the share price by a good few % since the taxation on a "Dividend" would not apply.
I imagine that it will correspond to the reduction in share capital
hopefully we will all know on monday 25th jan when the circular is due to be released
Nutella
From a recent RNS . 'further details about the resolutions to be considered at the General Meeting, will be sent to shareholders on or around 25 January 2021.
Maybe the current trading range will buy time to fully digest those details and also give shareholders the time to think on whether or not to buy hold or sell before the 11th Feb.
Reading some of the other bb's it is clear that many investors are making too many assumptions on where they see the sp after the vaccine has been rolled out.
TSCO on the face of it looks pretty dull compared to the so called bargains out there. The market is forward thinking and a little too eager in thinking the worst is behind us.
Personally, I think the consolidation is to shore up the share price for institutional investors. I think it will be 5:2 or 5:3 but I bet I am wrong.
From all the the other peoples recent posts on the subject I think it will be 1 for every 5 , which will be a 20% reduction in your holding .
The divi at current price is 20% (ish ) The point of the consolidation is to shore up the sp by the amount of the dividend.