Dividends

Dividends

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Hi all,

Our company has recently undergone a restructure.

Until the 22nd of the month we had 2 shareholders, both owning 50% of the business (A = 50%, B = 50%).

On the 23rd of the month, a third shareholder bought some of the shares. The revised structure was (A = 60%, B = 10%, C = 30%).

Every month, the company declares and pays a dividend.

With respect to the month of the restructure, do we pay dividends based on the structure at the end of the month? (60/10/30?)

Or is a weighting based on the days ownership more appropriate? (22 day @ 50/50 and 9 days @ 60/10/30).

I suspect that either route is permissible?

Would appreciate any thoughts.

Thanks.

Replies (3)

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By johngroganjga
29th May 2015 10:32

There is no weighting. What does the declaration say? If it does not specify that the dividend will be paid to the shareholders registered at close of business on (insert date) you should ask the person who drafted it why not?

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By User deleted
29th May 2015 10:33

Dividends are paid to shareholders whose names appear on the register of members on the record date. So if you have voted dividend the last day of the month and if on that date there are three shareholders appearing on the Register of Members then dividend is payable to all the three. However, I presume the restructure doesn't fall foul of the anti-avoidance provisions.

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By Matrix
29th May 2015 10:49

I assume you have also looked at the Employment related securities implications if the shareholders also work for the company.

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