We have had a number of queries in from CRH shareholders on foot of the piece we did a couple of weeks ago. With the shares now trading on the New York Stock Exchange from Monday, it seems to make sense to tackle the questions as soon as possible.
To get through as many as possible, we’ll do so in a fairly tight Q&A format, with the bones of the answers having been given to us by Computershare, the registrar of the shares in the US. It has to be said that in most cases this amounted to little more than “read the circular”.
Q: It says that my statement of holding will be posted to me with my HAN shortly after September 25th. I assume I cannot sell my shares until that does arrive. That being so, can you get a more precise date when Irish shareholders can expect to receive the necessary documentation? What are the costs involved, if any, of having the shares held by a US transfer agent?
A: I gather the statements of holding and the Holder Account Number (HAN) will be issued very quickly, within a matter of days, and then it is down to the postal system.
Computershare tells me that a number of days will be required to “prepare, audit, print, pack and post” the statements. They will be posted from here so you’re not relying on the US postal service.
You are very unlikely to be able to trade the shares until you have these details as they have now transferred to the US registrar, which they refer to over there as the transfer agent (to avoid you being confused if that terminology is used in any letter you receive).
You won’t be paying the transfer agent anything. The costs will relate to the charges of the broker you use to sell or buy shares, and the key thing, obviously, is to make sure they can operate on the US market.
Q: I hold my shares with CRH through Davy. They gave me another option which was to transfer my holding to Crest and trade on the London Stock Exchange. You didn’t mention this in your article, but I opted to take that route. Does that have any impact on the dividend withholding tax position for an Irish resident?
A: Nope. As the company is based here, you will be subject to Irish dividend withholding tax anyway – at 25 per cent.
The shares will be trading on both the New York and London exchanges, so Davy will have no problem managing your shares through the Crest account route and trading in London.
Q: In the event of the death of an Irish CRH shareholder resident in Ireland after the US listing takes place (the shares being held in certificated form at the present time in the shareholder’s sole name), will a US grant of probate or similar document have to be extracted after the death to enable the shares to be dealt with by the executors? Or will the US-based registrar be able to act at the executors’ request on production of an Irish grant of probate, as would be the case at the present time in view of the shares being an Irish asset?
A: Good question. The last thing you want at a time like that is having to clear probate across two jurisdictions. Computershare noted that even now that the listing has moved to the US, CRH remains an Irish company, incorporated and tax resident here, not in the US.
So, on that basis, it seems like Irish probate would cover it. Computershare says expressly: “The NYSE listing does not introduce any new or additional requirements for a US grant of probate on death.”
Q: Does the relocation of the shares to a US register make any difference in practical terms when I want to sell the shares? Will it be slower? Will it have to be done through a US broker, or can I use an Irish broker? If I choose to, can I use a US broker even if I am living in Ireland?
A: You can sell your shares either in New York or in London as they are listed on both of those markets. As to who you use to sell them, that depends on the services various brokers offer. Most of the big brokers will be able to trade on multiple markets but check with them before signing on.
In terms of the process, Computershare says: “As our share register will be administered through the US, there are some practical differences in the process of transferring shares to a broker.” This would be well known to any broker as they regularly operate through this system when dealing with US shares.
The process requires the completion of a stock transfer form, complete with a medallion signature guarantee (which Computershare says is typically provided by your broker) for all transfers irrespective of whether shares are to be traded in New York or London. I’m going to come back to this issue of medallion signature guarantee in the next week or so as it will be new for many small-scale Irish-based CRH shareholders.
As regards timing, Computershare says: “The speed with which any transaction can be processed will be directly related to the provision of the required documents.” Your broker will be able to give you a proper fix.
Q: Since CRH only wrote to shareholders on August 24th about the W-8 BEN, many will miss the chance to sell before the September 25th transfer since stockbrokers have already stopped accepting share certificates even for clients with an existing account on Tuesday. Why did the company not give people more notice? Or can the time to sell before transfer be extended?
A: That ship has sailed, I’m afraid, as the shares have now been transferred. Computershare says that the egm circular, which was issued as far back as May 9th, did warn about timelines and various tax-related matters, such as the W-8 BEN form-filling requirement.
Of course, that assumes all shareholders read the full circulars they are sent out. They should, of course, but the reality, I’m guessing, is that few do. Unfortunately, once the timelines are set, they are set in stone.
Please send your queries to Dominic Coyle, Q&A, The Irish Times, 24-28 Tara Street Dublin 2, or by email to firstname.lastname@example.org. This column is a reader service and is not intended to replace professional advice