BHP Billiton

[Roadmap2Retire]

Thoughts on BHP Billiton? Anyone buying today after the 5% drop?

[Dividend Watcher]

Actually, I opened a small position last week and was thinking of selling at a loss. Details are scant right now.

[Roadmap2Retire]

Its been on my watchlist, but still havent done my full research on the stock. From what I see, the drop is because investors were expecting a special dividend or more buybacks. Why are you planning on selling at a loss?

[Dividend Watcher]

Well, too much uncertainty regarding corporate structure, dividend policy and tax status.

Quote:The new company is expected to be listed in Australia and to have a secondary listing in South Africa. The spinoff company would probably seek to have American depositary receipts traded in the United States as well.

I'm still mulling it over and waiting to hear more from management. It's already taken its big drop and expect it to trade around this new level so it's not a rush yet. I'll try and get some reading in today to become a little more informed.

[Jason]

From what I have read it is better for Americans to buy bbl for tax purposes since it is based in England.

Looks like they are bundling unwanted assets and spinning them off into a new company. I wonder how it will affect the dividend.

[Roadmap2Retire]

Out of curiosity, do Americans pay taxes for Austrialian stock dividends (BHP). I know you guys dont on UK-based stocks like BBL.

In Canada, both UK and Australia-based stocks can have no withholding dividend taxes making them ideal for TFSA accounts (equivalent of the US Roth IRA).

[Dividend Watcher]

The tax withholding aspect is one of my questions. They said they will spin off the new company and list it on the Australian and South African exchanges and possibly ADRs in the U.S. Since I don't own an ADR, don't know exactly how the structure is treated. Since my holdings are in a traditional IRA, any withholding is not recoverable at tax time and takes away from my return. Not interested in that case.

They also weren't clear on how the business that's left is going to be structured. Didn't help that BBL's web site crashed today since everyone else was trying to get information from the horse's mouth also.