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Mr Kenwright "In Specie" Dividend

I just caught a copy of this article and wondered whether the superior force that is ToffeeWeb posters could put forward some facts and /or theories as to what this is about.

Any company law/tax experts care to comment?

"THEATRE impresario Bill Kenwright has transferred his shareholding in Everton Football Club to a separate company as part of a 'structural reorganisation'.

According to the most recently filed accounts at Companies House, his company Bill Kenwright Ltd paid a 'dividend in specie' of £7.5m representing its investment in The Everton Football Club Company Limited.

The ownership was transferred to a separate company under Mr Kenwright's ownership in January 2009 and he remains the club's chairman."

Jay Harris, Liverpool Posted 23/03/2010 at 14:47:28

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Adam Fenlon
1 Posted 24/03/2010 at 00:57:26

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In specie dividend just means a non-cash distribution of an asset/assets (in this case the investment in EFC) from a holding company to its immediate shareholder or parent company. Doing it this way rather than structuring it as a sale between the two companies can be more tax-effective depending on the company's situation.

Could well be just a case of housekeeping to make the structure more flexible for the future rather than a signal of anything happening with new investment.

Eric Myles
2 Posted 24/03/2010 at 03:41:55

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So does that mean that BKs shares are only worth 7.5 million Quid?

Alan Williams
3 Posted 24/03/2010 at 07:41:04

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To be honest I'm surprised he has never done this before. Three reasons why he may have done it.

Firstly: BK Ltd can obviously cope without this asset so that has to be good news;

Secondly: Tax can be an advantage but not necessary critical as EFC doesn’t pay to my knowledge high dividends if at all;

Thirdly: it makes it easier to sell depending on the state of the company of which he has transferred the fund too.

If Jay could check this out then all you need is a company name and reg number then all will be reviled. I think this story is more interesting to where or what is the new company that controls the “specie”. Eric: No it doesn’t this is just the shares held by BK Ltd and not him as an individual or as “family” may own.

My guess is he has created either a Holding/New company to protect his assets so this allows him on both counts be it football or theatre to either sell or not lose both of his assets should times get hard, basically this is a very prudent move by Bill. COYB

Brian Noble
4 Posted 24/03/2010 at 09:39:44

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So if Blue Bill `goes down the drain`as a theatre impressario, he wont lose control of EFC.
How re-assuring!

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