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Shell stops scrip dividend program, switches emphasis to share buybacks

Comments (10)
  • Chris Zocca
    , contributor
    Comments (250) | Send Message
     
    This means that US investors will no longer be able to avoid foreign tax withholding on RDS-A shares by re-investing dividends via the scrip dividend programme. In retirement accounts, there is no way to recover these withheld foreign taxes. US investors who own RDS-A shares in retirement accounts should switch to RDS-B as the B shares represent shares traded in London and they are not subject to foreign tax withholding due to a treaty between US & Great Britain.
    22 May, 08:47 AM Reply Like
  • Rick D
    , contributor
    Comments (325) | Send Message
     
    True, and good advice. I suggest making the switch after June 26 (when the last payout of shares under the Scrip Dividend Programme occurs) but before the ex-dividend date for the next dividend (currently scheduled for August 13).
    22 May, 02:51 PM Reply Like
  • maybenot
    , contributor
    Comments (3347) | Send Message
     
    Interesting. Seems a rather unfriendly shareholder move. Whatever.

     

    Long XOM, COP, BP, CVX
    22 May, 09:29 AM Reply Like
  • Hammer29
    , contributor
    Comment (1) | Send Message
     
    Can someone tell me why the b shares are down
    22 May, 10:40 AM Reply Like
  • Slick E
    , contributor
    Comments (117) | Send Message
     
    My best guess is that US/UK investors are typically invested in B shares (for tax reasons) and are spooked.

     

    Chris Zocca is right, and this is a real bummer. I've enjoyed holding the A shares with their superior yield, and haven't had to worry about the Dutch taxes because of the Scrippe dividend reinvestment. Now I have to decide whether to switch to the B shares or move out of Shell entirely.
    22 May, 11:26 AM Reply Like
  • Rick D
    , contributor
    Comments (325) | Send Message
     
    B shares were at an artificially high level due to Shell repurchasing large amounts of B shares. In the future, Shell will not be forced to repurchase only B shares, but will be able to repurchase either share class. With a large spread, obviously they would repurchase A shares because they are cheaper. That would move the excess demand from B shares to A shares, greatly narrowing the spread.

     

    The market is reacting to the upcoming change in supply and demand for the two share classes.
    22 May, 02:48 PM Reply Like
  • Slick E
    , contributor
    Comments (117) | Send Message
     
    I came across this discussion on why the gap is narrowing now between the A and B shares. It's very interesting and well explained.

     

    http://bit.ly/1tpwv8w
    22 May, 02:04 PM Reply Like
  • smurf
    , contributor
    Comments (3777) | Send Message
     
    I like it. Rather have the cash. Long RDS-B.

     

    Mr. Market will get over it. Don't understand why they have fallen in the first place.
    22 May, 02:04 PM Reply Like
  • heligator
    , contributor
    Comments (52) | Send Message
     
    Before today the gap widened significantly from even a year ago. It's not surprising to see it shrink from both sides.
    22 May, 04:15 PM Reply Like
  • vandeley
    , contributor
    Comments (108) | Send Message
     
    The stock didn't drop, just the spread between the two shares decrease. RDS A went up.
    23 May, 05:24 AM Reply Like
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