Dominic Coyle answers your financial questions.

Holding on to Alphyra shares

I bought 300 Alphyra shares several years ago during the technology boom. When the management and Benchmark Capital took the company private two-and-a-half years ago and offered shareholders less than €3 per share, I refused to sell my 300 shares because I would have lost money on the investment.

I was annoyed that they wanted all shareholders to sell out because it suited them. Now I have read recently that Alphyra are planning to return to the stock market and there has been a report that it could be worth up to €600 million, much more than it cost them to take it private. But I still have my shares. If the company is re-floated, am I entitled to get the increased value for my shares?

Mr G.S., Dublin

I can fully understand why shareholders get so annoyed when companies in which they have invested are taken private at a fraction of the price they initially paid for the shares.

It is even worse when the company subsequently adds considerable value as a private group and then seeks to return to market to seek public support from the investment community. I am also aware that the management buyout (MBO) of Alphyra was more than usually controversial.

However, the rules are the rules and there is nothing legally wrong with the approach taken by Alphyra and Benchmark.

Your problem is that, in a move that ultimately hurts only yourself, you refused to surrender your shares to a compulsory purchase situation.

The fact that you still have the shares you were supposed to surrender doesn't mean they are worth anything - they aren't.

Consequently, you will be able to get nothing more for your shares than the figure at which Alphyra was taken private, regardless of the higher level at which they might refloat on the Irish Stock Exchange or elsewhere.

The only money you are likely to receive is the €270 a share that the MBO vehicle Rendina ultimately offered - and you have only been losing interest and/or investment returns on this money since March 2003 by leaving it with the company's registrar.

Inheritance tax

I recently read a response you gave to a query concerning inheritance tax. Essentially, this dealt with unmarried couples and their liability to CAT. Are partners ever exempt from CAT? What provisions apply?

Ms C.M., e-mail

The only area where partners benefit from exemptions under the capital acquisitions tax (CAT) regime is where they receive the family home. If they have been resident in the property for the three years prior to the inheritance, have no "beneficial interest in another residential property" and remain in the home for six years after receiving the inheritance, it is CAT free. Apart from that, partners are treated as strangers under CAT rules and benefit only from the lowest threshold, currently €23,336.

Please send your queries to Dominic Coyle, Q&A, The Irish Times, D'Olier Street, Dublin 2 or e-mail to dcoyle@irish-times.ie. This column is a reader service and is not intended to replace professional advice. No personal correspondence will be entered into.