BP and Burmah Oil
With the election clouding the prospects of industrial shares, the oil group should find in- creasing support. BP were quoted ex the rights at 69s. 6d.—the new at 19s. 9d. premium—but these shares, to yield 5.8 per cent, look dear as com- pared with BURIvtAH at 59s. 6d. (ex the capital distribution), to yield 6.4 per cent. Burmah are issuing 71 per cent preference shares at 20s. to pay for their shares of the BP 'rights' issue. Being 'franked income,' these preference shares should appeal to investment trusts and, as they Inn command a small premium, shareholders should subscribe for as many as they can pay for. It Is a pity that Burmah directors do not tell their shareholders what their immediate dividend policy is likely to be. When corporation tax is being paid in full by all the oil companies, Bur- mah will be able to pass on the dividends it recehes from BP and SHELL directly to its share- holders without loss, because the 8s. 3d. tax will have been paid and 14 ill be used as credit against Burinah's liability to deduct tax from its own dividends. Sonic time Burmah must do the right thing—distribute its BP shares to its shareholders —unless BP takes it over first
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