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Last Updated: Tuesday, 28 September, 2004, 10:44 GMT 11:44 UK
What's happening with Abbey?
For shareholders, the offer is worth around 5.60

Abbey National has 1.8 million shareholders - so a lot our viewers are affected by the proposed takeover by the Spanish bank Santander Central Hispano.

Feedback to the programme highlights that there are a lot of worried people out there, all concerned about what to do.

If you are a shareholder you will have received 399 pages of explanations, charts and jargon.

Which of course - in trying to answer everything - makes it far too arduous a read for everyone to get through.

It's not Abbey's fault, because by law they are obliged to send out documents like this.

Too many of you have written in to mention everyone by name - but we hope this article answers most of your questions.

Shareholder power

But first, there is something unusual and really interesting about this vote, and that is that small shareholders are unusually important.

For once, individual investors have huge power here

Voting on the issue is decided by one member one vote.

Normally each share carries a single vote - so large institutions get thousand of votes and the small shareholder is hardly heard. Not here.

At the meeting where Abbey has to get approval from a majority of people - the multi-million pound shareholder blocks of the City get the same single vote as the tiny shareholder.

So, for once, individual investors have huge power.

Although there is a caveat that the votes have to speak for at least 75% of the shares in circulation.

There seem to be four main concerns for shareholders - tax, Isas and Peps, customers and value.

Tax

So lets start with tax. And it's scary. If this goes through you are going to start getting dividends from a Spanish company.

They are going to be taxed according to Spanish laws which means that the tax on dividends will be higher.

You will be taxed according to Spanish laws

You are also going to have to send a foreign income supplement on your tax return.

Moreover, once you sell your shares, you are going to have to fill out a Spanish tax return along with a certificate from the Inland Revenue.

Isas and Peps

If you have the shares in a Pep or Isa you should contact your manager if you want the forms and haven't had them.

Customers

As for customers - the present plans are that business will continue and your accounts will still exist.

Value

For shareholders, the offer is worth around 5.60. That's above today's share price and quite a bit above the 4.20 that it was before the deal was talked about.


Other stories in today's programme

Simon Gompertz looked at demands for change in the tax credit system after "critical failures."

Capital Radio and GWR agree the terms of a merger which will bring together Capital FM and Classic FM, creating one of the UK's biggest commercial radio groups.

Check-out staff at supermarket giant Tesco are being asked to help recruit 12,000 Christmas workers.

A survey by the Cool Brandleaders Council reveals actor Johnny Depp is the coolest celebrity, Audi the coolest car and Diesel the coolest clothing.

Virginia met a lady who imports and exports Indian jewellery. The jewellery is sent via Royal Mail's tracking service Airsure - which is a premium service to allow people to know the exact location of their order. The lady says the service is abysmal.

Rob Pittam visited Harland and Wolff in Belfast. Since the company's difficulties last year it has re-focused its operations - including a switch to building bridges - and is quietly confident for its future.

SEE ALSO:
Q&A: Abbey National takeover
15 Sep 04  |  Business


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