I was collecting the mail on Christmas Eve and was told there was a parcel waiting. Is this a nice surprise in store, I wondered.
The reality was somewhat more prosaic. The package was the Scheme Booklet for National Australia Bank’s demerger of Clydesdale Bank. I’ve seen a few such booklets and the like over the years, but I can’t recall one as bulky as this – 580 pages and nearly 1.3 kg.
It’s proposed that NAB shareholders will end up with security interests in the de-merged Clydesdale Bank. Hmmm, not sure about this (NAB hasn’t had much joy from this investment, and do we want shares in a British bank?). I admit that the only thing I initially looked for was details of the sale facility to enable the securities to be sold and the proceeds sent through in cash! But just in case if I do just happen to occupy some of my time over the Christmas period delving into the details, and change my mind, I’ve resisted my first impulse to go on line and opt into the sale facility.
In fact, seemingly buried away in the document (page 178) is what could be a potential CGT sting – the capital reduction portion might be taxable as a non-franked dividend. I certainly haven’t had time to think through all the details (on reflection, maybe some summer reading is going to be required), although this report alludes to them. I notice that the Grant Samuel report plays down the implications (page 232).