Jump to content
House Price Crash Forum
Sign in to follow this  
DonnieDarker

Can Anyone Explain 'reduction Of Capital' To Me?

Recommended Posts

My GF has been advised to buy some Bristol Water shares.

I was looking into them and noticed than in July this year they reduced their capital by buying back a load of shares off holders.

Subsequently the share price dived from 900 to 600.

Can anyone explain why they did this?

I would have thought that fewer shares would be worth more, not less?

God I'm ignorant!

Help please.

Share this post


Link to post
Share on other sites
Subsequently the share price dived from 900 to 600.

Is the company in question Bristol Water Group, with the EPIC (a three- or four-letter acronym used on stockmarkets to identify individual stocks) BWG? If it is, the share price chart from FT.com does not show it ever having reached 900p. It seems to have traded in a range around 650p for the last year or so, and was much lower than that in 2004.

http://news.ft.com/marketdata/equities

Type "UK:BWG" into the box on the right-hand side of this page, click "Quotes" and then "Go" to bring up the graph in question.

One possible reason for a share price to fall (among many) is if the share goes "ex-dividend" (this is a cut-off date after which anyone buying the shares will not receive the latest dividend). I'm not saying that this is what has happened in this case, but just FYI.

Share this post


Link to post
Share on other sites
Is the company in question Bristol Water Group, with the EPIC (a three- or four-letter acronym used on stockmarkets to identify individual stocks) BWG? If it is, the share price chart from FT.com does not show it ever having reached 900p. It seems to have traded in a range around 650p for the last year or so, and was much lower than that in 2004.

http://news.ft.com/marketdata/equities

Type "UK:BWG" into the box on the right-hand side of this page, click "Quotes" and then "Go" to bring up the graph in question.

One possible reason for a share price to fall (among many) is if the share goes "ex-dividend" (this is a cut-off date after which anyone buying the shares will not receive the latest dividend). I'm not saying that this is what has happened in this case, but just FYI.

I have it at 893 in july.

RNS statement.

Bristol Water PLC

07 July 2005

7 July 2005

Not for release, publication or distribution in or into the United States,

Canada, Australia or Japan.

                               Bristol Water plc

                Recommended proposals by Bristol Water Group plc

                                      for

                    a return of 148 pence per Ordinary Share

                                      and

     a 10 for 13 Consolidation of Bristol Water Group plc's Ordinary Shares

         Filing of Court Order - Reduction of Capital becomes effective

Bristol Water plc notes the announcement made today by Bristol Water Group plc,

the text of which is set out below.

                            "Bristol Water Group plc

                Proposed Return of 148 pence per Ordinary Share

                          and 10 for 13 Consolidation

         Filing of Court Order - Reduction of Capital becomes effective

The Board of Bristol Water Group plc ("Bristol Water") is pleased to announce

that following filing of the Court Order made on 6 July 2005 with the Registrar

of Companies, the reduction of capital of the Company to cancel and repay the B

shares of the Company has become effective. The B Shares have been cancelled and

will now be repaid at 148 pence per B Share. Cheques will now be posted by 15

July 2005 to shareholders on the register of Bristol Water as at 5.00 p.m. on 5

July 2005.

Terms and expressions used in this announcement have the same meanings as in the

Circular posted to Shareholders on 20 May 2005."

Enquiries

Bristol Water plc Tel: 0117 953 6407

Alan Parsons, Chairman

Andy Nield, Finance Director

Dresdner Kleinwort Wasserstein Tel: 020 7623 8000

Christian Littlewood, Director

Dresdner Kleinwort Wasserstein Limited, which is authorised and regulated by the

Financial Services Authority, is acting for Bristol Water Group plc and no one

else in connection with the Proposals in the Circular and is not acting for any

person other than Bristol Water Group plc and will not be responsible to any

person other than Bristol Water Group plc for providing the protections afforded

to its customers or for providing advice in connection with the Proposals in the

Circular and the other matters described herein.

                      This information is provided by RNS

            The company news service from the London Stock Exchange

chart_11164_6month_194x140.png

bwg.png

post-1435-1127057805_thumb.jpg

post-1435-1127058274_thumb.jpg

Edited by theChuz

Share this post


Link to post
Share on other sites

Yes it is that company. I think the FT only track the new share.

Still confused about it.

I guess it means they are getting to grips with their debt which is a good sign for a solid long-term investement which is what the GF wanted.

Share this post


Link to post
Share on other sites

OK. The company restructured which is why there is a discrepancy in the prices.

The GF has bough the shares. They look very solid.

The yield is 5.4% and the projected growth from a trusted source is 10% this year.

Share this post


Link to post
Share on other sites
OK. The company restructured which is why there is a discrepancy in the prices.

The GF has bough the shares. They look very solid.

The yield is 5.4% and the projected growth from a trusted source is 10% this year.

Utilities always seem to be solid and give good returns. I have some United utilities shares (epic uu), they are yeilding 6.9% although there is no growth forecast.

Share this post


Link to post
Share on other sites

Join the conversation

You can post now and register later. If you have an account, sign in now to post with your account.

Guest
Reply to this topic...

×   Pasted as rich text.   Paste as plain text instead

  Only 75 emoji are allowed.

×   Your link has been automatically embedded.   Display as a link instead

×   Your previous content has been restored.   Clear editor

×   You cannot paste images directly. Upload or insert images from URL.

Loading...
Sign in to follow this  

  • Recently Browsing   0 members

    No registered users viewing this page.

  • 336 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



×
×
  • Create New...

Important Information

We have placed cookies on your device to help make this website better. You can adjust your cookie settings, otherwise we'll assume you're okay to continue.