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Shareholders in last-ditch fight with Shell

THE SUNDAY TELEGRAPH: Shareholders in last-ditch fight with Shell

12 June 2005

BY PAUL FARROW

THE ASSOCIATION of Private Client Investment Managers and Stockbrokers is to meet Shell, the oil giant, next week in a last-ditch attempt to save Royal Dutch shareholders from capital gains tax bills running into thousands of pounds.

Apcims has received more than 300 calls and letters from angry shareholders since it emerged two weeks ago that they would be saddled with huge CGT bills when the

planned merger of Royal Dutch and Shell Transport & Trading goes ahead on July 20.

Dutch and American Royal Dutch shareholders and Shell Transport & Trading investors are exempt from CGT when their shares are exchanged for shares in the new company.

Angela Knight, the chief executive of Apcims, said she is to propose that Shell make a secondary share offer, exclusive to UK Royal Dutch shareholders, that qualifies for rollover tax relief. This would enable the merger to go ahead without delay, she said.

One call Apcims received was from Tony Holland, who lives in Guildford. His wife, Patricia, inherited Royal Dutch shares from her mother 40 years ago and they are now valued at £377,000. Their CGT bill, after taper relief and exemptions, will be about £90,000. Holland said: “It is a monstrous situation. We work to a budget. It is my wife’s main source of income.”

Knight added that most of the 2,500 UK Royal Dutch shareholders were

elderly, having held Royal Dutch shares since the late 1970s when the Wilson government put a dividend restriction on Shell Transport.

“We had a call from an 88-year-old widow with £287,000 worth of shares, while a member firm has 224 clients holding 300,000 Royal Dutch shares worth £9-6m. “If nothing is done, people will have to sell some of the shares to pay the tax. They will lose a significant part of their shareholding and the associated income.”

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