Vodafone – Verirzon Consideration

Vodafone recently sent correspondence to shareholders with details on the deal with Verizon. Vodafone, following on from their correspondence in December 2013, carried out a return of value to shareholders, partly in cash and partly in Verizon Shares.
There was a consolidation of the existing shares for new Vodafone shares at a rate of 6 new shares for every 11 held.
E.g. original share holding 2539 – new shareholding is 1384.
Return of Value – Verizon Shares
Shareholders also received 0.026 of a share in US telecoms group Verizon as part of the deal. That means shareholders will have received one Verizon share for every 39 Vodafone shares they held and any fractions of entitlements to Verizon shares will have been automatically sold on behalf of the shareholder. E.g 2539*.00263001= 66 or 2539/39 = 66 Verizon Shares
Return of Value in cash – $.4928005 for every Vodafone share held
E.g. 2,539 *$.4928005 = $1251.22
There were a number of forms enclosed in the recent correspondence sent by Vodafone.
·         Details of the consideration for each shareholders individual holding
·         Dealing form – Vodafone is offering a free service to sell shares. The form is to be signed and returned only if selling your shares
·         W-8BEN- Certificate of Foreign Status of Beneficial Owner for United States Tax Withholding. Verizon is an American company and pays dividends in the US. For a non-US resident receiving US dividends a US company will automatically apply 30% withholding tax unless a W-8BEN form is received from the shareholder.  In the Irish – US tax treaty agreement, it is agreed only 15% withholding tax should apply on US dividends but also only a credit of 15% withholding tax is given by the Irish Revenue on the Irish shareholders tax return forms even if 30% withholding tax is applied where no W-8BEN form is completed by the shareholder. In order that only 15% of withholding tax is applied instead of 30% withholding tax then a shareholder must complete and sign a W-8BEN form and return it to Computershare.