GSK demerger

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11th Mar '22 by Jamie Boot

13 comments 979 reads

Hi there, newbie investor here.

I have approx £20k of GSK shares.

What is peoples understanding of how the demerger will work? I understand I will get shares in the new company, Heleon. Is it likely to be an equal amount to my current GSK holdings?

Also is the value of shares in the nearly formed New GSK likely to go down as they are splitting assets etc?

Tryiky to figure out what my £20k of GSK shares plus the new Haleon shares is going to look like after the split

can anyone offer any insight?

Thanks

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Jamie Boot

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13 comments

Jamie Boot

11th Mar '22

Any ideas anyone?

jjis

11th Mar '22

You will end up with 2 lines of stock, which when they start trading should be roughly worth what your GSK is worth the day before +/- any price moves on that day. Your dividend income will go down as the two parts have been suggested to pay a total of about 55p v 80p current. See RNS's from 23/6/21 & 28/2/22 for more background detail. Full prospectus due in June 2022 when presumably you'll get more info on entitlements etc. Hope this helps.

brads13

11th Mar '22

IC covered the GSK demerger plan some 8 months back https://www.investorschronicle...

Roy Rylands

27th Jun '22

In an Email I recieved from Eqinity, it said that " For every share in GSK that I hold at 6pm on the 15th July i will receive 1 Haleon share" , Then they will issue new shares in GSK after consolidation.

I was quite optimistic about this split I even bailed out of Lloyds Bank to raise cash to buy more GSK but the nearer it gets the more nervous I feel.

I spent most of most of my working life with Glaxo so perhaps I am being too sentimental.

steviej

20th Jul '22

Anyone worked out a way to implement this consolidation without doing a full sell and buy?

Redice

20th Jul '22

I've ' sold ' 20% of my GSK holding at £16.50 a share and ' bought ' my allocation of Haleon at £3.30 a share. The two amounts cancel each other out. I believe Haleon started trading at £3.30 although unfortunately it didn't stay there long!

PLS1nve5t

20th Jul '22

Confusing - my Hargreaves account shows Haleon as a purchase price of £2.57 so it looks like I'm up on them by nearly 20% ? though I can see from the charts the opening price was £3.30 !!

For accounting, I reduced the original purchase price of GSK by 18.9%, then multiplied the quantity of shares by 4 and then divided by 5 (rounded down to whole number).

For Haleon original number of GSK shares and a purchase price of £2.57.

GloucesterBob

20th Jul '22

Our very own Graham Neary has written about HALEON (LON:HLN) on his other website https://monopolyinvestor.subst...

Not going to reproduce it here, but I found it interesting on potentially how this share could play out.

Paul2148

20th Jul '22

Haleon was 19.1% of GSK at £2.57. Used this to work out the value of shares held.

I then used the share consolidation option in the portfolio to lower the number of GSK shares for the consolidation before then recalculating my purchases and editing them to the lower value. End result showed the same % gain as pre split and consolidation and both totalled the same value.

Wish this was automated to be honest but didn’t take long tbf

PLS1nve5t

20th Jul '22

GSK plc - Consolidation effective

Dear Mr xxxxxx

The demerger of Haleon plc by GSK was completed yesterday. You have been given 1 Haleon share for every GSK share held at the end of 15 July 2022.

Share consolidation

You’ll notice the GSK share price dropped yesterday to take into account the value of the Haleon shares issued. However, GSK wants to keep the share price roughly the same before and after the demerger. To do this the company has today reduced the number of GSK shares every shareholder owns. Shareholders have been given 4 new GSK shares for every 5 GSK shares held at the end of yesterday. You may also get a small cash payment in early August to cover any difference from rounding.

Total value and cost prices

Now the consolidation has happened, the total value of your new GSK and Haleon shares added together should be similar to the value of your original holding.

You will notice the cost price showing in your online account has changed. As approximately 18.9% of the value of your overall investment yesterday morning was represented by the Haleon shares, 18.9% of your original GSK cost has been removed and added as a cost to your new Haleon shares.

If you have any further questions about the consolidation, please contact us.

Don't forget you can stay up to date with all the latest stock market news and expert views via our website. Visit our website now.

This is the email I received from Hargreaves, I just followed this for updating my accounts...

PLS1nve5t

20th Jul '22

Ahh thats it £3.30 - 18.9% explains the £2.57 price shown on the account - I'm too confused now to work out if I have been diddled or not :-)

PLS1nve5t

20th Jul '22

bugger £3.30 * (100-18.9) is £2.67 not £2.57 have they have screwed me out of 10p a share.... or have I gained 10p a share ? sorry it's just too confusing.....

steviej

21st Jul '22

Thanks for your input all, but none of that worked for me, so I just "sold" and bought back. The consolidation feature simply reduced my holding (including fractional share) and so didn't help with the free shares in newco, so couldn't get the cash balance to settle correctly.

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GSK demerger

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Jamie Boot

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