| Q. |
Has the demerger been approved? |
| A. |
Yes. On 28 March 2003, the Federal Court of Australia approved the demerger of Rinker Group Limited (Rinker) from CSR Limited, after shareholders had voted overwhelmingly in favour of it on 25 March 2003. |
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| Q. |
Are CSR and Rinker shares now trading separately? |
| A. |
Shares in CSR and Rinker began trading separately on the Australian Stock Exchange (ASX) on 31 March 2003. |
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| Q. |
What is the capital gains tax impact on CSR shares as a result of the demerger? |
| A. |
CSR shares acquired before 20 September 1985 will remain free of Australian capital gains tax (CGT) (as generally will the equivalent number of Rinker shares which you receive as part of the demerger). However, for shares acquired since 19 September 1985 and held immediately before the demerger, shareholders need to apportion the cost base of CSR shares between the CSR and Rinker shares held immediately after the demerger.
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| Q. |
What is the new cost base for CSR shares? |
| A. |
The Australian Tax Office in its class ruling CR2003/10 requires CSR shareholders to base the new cost base on share market values of CSR shares and Rinker shares just after the demerger.
As a guide to assist in those calculations, CSR shareholders may base their apportionment on the relative volume weighted average prices of CSR shares and Rinker shares sold over the first five days of trading of both CSR and Rinker on the ASX, beginning 31 March 2003. These were:
CSR - A$1.61 25%
Rinker - A$4.88 75%
As an example, if your CSR shares held just before the demerger had a cost base of A$5.00, the cost base of CSR shares after the demerger would be 25% of A$5.00 or A$1.25 and the cost base of Rinker shares would be 75% of A$5.00 or A$3.75.
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