# Vodafone: what value would they have to reach to break even with Eircom floatation Pr



## frankmac (26 Sep 2007)

With Vodafone shares doing so well at the moment (£1.72), I was wondering would anyone know what they would need to reach ( approximately) in order to get to the level of the initial investment in Eircom, taking into account the payment received at the time of the split and bonus issues.

I appreciate that inflation is also a consideration


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## Guest127 (26 Sep 2007)

*Re: Vodafone shares*

think at one stage they had to reach €5.50 but that was before a few of those special payments they made.


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## Billo (26 Sep 2007)

*Re: Vodafone shares*

I would say that about double their current valuation would be about right. Do not ask me for the calculation as I am anly guessing.


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## blondebimbo (26 Sep 2007)

*Re: Vodafone shares*



Billo said:


> I would say that about double their current valuation would be about right. Do not ask me for the calculation as I am anly guessing.



oh my god was it that bad?


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## frankmac (27 Sep 2007)

I found this by searching.

If this is true then the original cost was €3.90. Valentia paid €1.335 at the time of the split which leaves the cost at €2.565. At an exchange rate of 0.69 that calculates to £1.77.

Yesterday Vodafone was £1.755.

Just need to make up the inflation it seems. 


http://www.askaboutmoney.com/showthread.php?t=7312


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## CGorman (27 Sep 2007)

*Re: Vodafone: what value would they have to reach to break even with Eircom floatatio*



frankmac said:


> Just need to make up the inflation it seems.



Add in Dividends received also and i'd imagine your on your way to breakeven!


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## cerberos (27 Sep 2007)

Is there anyway to get a definite breakeven value from Revenue?
I am looking at [broken link removed] at the moment.


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## Guest127 (27 Sep 2007)

dont forget that you had to surrender over 2 original shares in eircom for 1 in vodaphone.


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## cerberos (27 Sep 2007)

so how does this work, any 1?


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## frankmac (27 Sep 2007)




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## cerberos (27 Sep 2007)

yah frank very informative.

I meant has it any effect on your figures


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## dtlyn (27 Sep 2007)

*Re: Vodafone: what value would they have to reach to break even with Eircom floatatio*



frankmac said:


> I found this by searching.
> 
> If this is true then the original cost was €3.90. Valentia paid €1.335 at the time of the split which leaves the cost at €2.565. At an exchange rate of 0.69 that calculates to £1.77.
> 
> ...



This isn't correct, there wasn't a 1:1 mapping between Eircom shares and Vodafone shares, it was one for every two or something....


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## frankmac (28 Sep 2007)

cerberos said:


> yah frank very informative.
> 
> I meant has it any effect on your figures


 
Sorry my  was at the previous post which basically blew my calculations out of the water


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## blondebimbo (30 Sep 2007)

I cant believe  and am frankly disappointed that among so many so called experts on this forum  that noone can say for certain how much each vodafone share is worth before it is taxed.
If there is a journalist among you and I hear rumors influential people do come here ,,, I suggest its a fantastic and popular article to have in your next business section of articles. 
Is it at least a certainty that in the case of an original holding of vodafone being sold then no tax liability  is payable ? (if we ignore dividends taken as shares)


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## dam099 (30 Sep 2007)

frankmac said:


> With Vodafone shares doing so well at the moment (£1.72), I was wondering would anyone know what they would need to reach ( approximately) in order to get to the level of the initial investment in Eircom, taking into account the payment received at the time of the split and bonus issues.
> 
> I appreciate that inflation is also a consideration


 
Is this question a matter of curiosity or are you waiting for your investment to break even before you sell? As a basis for making investment decisions this should be almost completely irrelevant, look at the value of the investment today and what you think it will be worth in your investment timeframe and evaluate that versus other shares and make your decision on that basis. (Tax considerations can have some relevance to the timing too but in general its more the future prospects of the share you should focus on)


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## blondebimbo (30 Sep 2007)

someone like my elderly mother who bought quite a few shares would worry about non payment of tax upon a sale and consequent possible revenue interest penalties and i would worry about both this and also how much of a loss can be written off. selling the shares without knowing and burying ones head ostrichlike in sand about tax due to ignorance is is a bad idea IMO
vodafone share taxable value is a important unanswered question in this forum


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## BOXtheFOX (30 Sep 2007)

blondebimbo said:


> someone like my elderly mother who bought quite a few shares would worry about non payment of tax upon a sale and consequent possible revenue interest penalties and i would worry about both this and also how much of a loss can be written off. selling the shares without knowing and burying ones head ostrichlike in sand about tax due to ignorance is is a bad idea IMO
> vodafone share taxable value is a important unanswered question in this forum


 
Maybe seek out a tax expert and pay for the advice and information?


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## GeneralZod (30 Sep 2007)

*Re: Vodafone shares*



Billo said:


> I would say that about double their current valuation would be about right. Do not ask me for the calculation as I am anly guessing.



I think that is fairly close to the mark. Here's a stab at calculating it. 

The original purchase price was €3.90.  They were bought out at €1.27 so the loss not including the vodafone shares was €2.63.

0.9478 Vodafone shares were given for every two eircom shares when eircell was sold. This equates to 0.4739 Vodafone shares per eircom share. 

Vodafone did a return of capital to shareholders last year that works out at about €0.12 per eircom share, subtracting that the loss is €2.51 per original eircom share. 

Now I'm going to assume that all vodafone dividends were reinvested into the share buy back scheme (as that's what I did) and ignore income tax that was paid on them. 

Assuming the above for every 1 original vodafone share given in exchange for eircell a shareholder would now have 1.0753 current vodafone shares.

So we get 1 eircom share = 0.5096 current vodafone shares (0.4739 x 1.0753). 
The value of a Vodafone share last Friday was €2.53. This equates to €1.29 (2.53 x 0.5096) per eircom share.

This brings the loss per eircom share to €1.22 ( 2.51 - 1.29).

To make up this loss the current vodafone shares would have to increase in value by €2.39 (= 1.22 / 0.5096) per share. 

This means the Vodafone shares need to increase by another 94% for break even.


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## frankmac (30 Sep 2007)

I'll take your word for it


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## megabyte (1 Oct 2007)

Can you still go into your local AIB Bank and sell the Vodafone shares,and if so do you pay them a % of what you are selling or just a fixed payment ??


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