As most people who read this blog are likely to be aware, Vodafone have recently completed the sale of the 45% of the U.S cellular telephone company Verizon Wireless that they owned, to Verizon Communications. The basics of this sale is that investors in Vodafone would receive 30p cash and 0.0263 Verizon Communications shares for each Vodafone share they owned. The broker that operates my SIPP and ISA will not allow the Verizon Communications shares to be held in these accounts so these shares were automatically sold by them.
As a result of the receipt and sale of these shares I have now received £3,634.28 into my SIPP and £804.54 into my ISA.
I had already decided what I was going to do with the proceeds, and have therefore bought additional Vodafone shares in my SIPP to offset the reduction in the number of shares by the share consolidation which was part of the deal (investors shareholdings were reduced to 6 shares for every 11 that they held.
In my ISA however I chose to buy some additional Unilever shares as the number I held didn’t pay enough dividend to automatically re-invest, they were also yielding just under 4% which I consider to be a good price for a company who own more than 400 brands (Ben & Jerry, Marmite, Persil, Domestos, PG Tips and Bernoulli to name a few), 14 of which have worldwide sales of more than €1billion. Many of these brands are likely to significantly increase their sales as Unilever expand into countries like India and China as their population becomes increasingly wealthy.
My purchases were therefore as follows:
1,273 shares in Vodafone added to the 2,727 left after the consolidation making my total holdings in my SIPP 4,000 shares
45 shares in Unilever added to the 80 already held, making the total in my ISA 125.
As a result of these purchases my annual dividend income should increase by approximately £140 in my SIPP and £40 in my ISA.
The second part of the Vodafone Verizon deal is due to happen next week. This is payment of the 30p per share, so next week I will be receiving £1,500 in my SIPP and £330 in my ISA, so I will have further purchases to announce later.