GND GNDP
GND
GND/GNDP - Grindrod Limited - Grindrod Preference Shares (GNDP)
Grindrod Limited
(Incorporated in the Republic of South Africa)
(Registration number: 1966/0009846/06)
Share code: GND & GNDP
ISIN: ZAE000072328 & ZAE000071106
("Grindrod" or "the Company")
GRINDROD PREFERENCE SHARES (GNDP)
The introduction in 2008 of withholding tax on dividends and the elimination of
STC (Secondary Tax on Companies) on a phased basis have been proposed as part of
the recent budget presentation. The text of draft legislation giving effect to
these proposed changes has not yet been released.
A number of enquiries have been received from preference shareholders as to
whether Grindrod will increase preference dividends in view of the anticipated
negative impact on preference shareholders of the new dividend tax, while
Grindrod is expected to benefit from the proposed abolition of STC.
The purpose of this announcement is to inform Grindrod preference shareholders
that to the extent that the proposed changes in the tax legislation result in
the preference dividends being taxable in their hands and in a reduced cost to
the Company in servicing the preference shares, it would be the intention of the
Company to pass on the benefit of the reduced cost to the preference
shareholders.
The proposed changes to the law are still under consideration but preliminary
legal advice indicates that any increase in the preference share dividend rates
to compensate preference shareholders for this new tax, would require an
amendment to the Company`s Articles. It is therefore a matter which would need
to be considered in due course by both the ordinary and preference shareholders
once further information regarding the legislation which will give effect to the
proposed changes becomes available.
A further announcement in this regard will be made once more detailed
information on the proposed legislation is published.
Durban
28 February 2007
Sponsor:
Exchange Sponsors (Proprietary) Limited
Date: 28/02/2007 14:22:00 Produced by the JSE SENS Department.
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