Private Investor: Having the time of my Standard Life

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The Independent Online

Hardly a bonanza, but handy none the less. As I write, shares in Standard Life plc, newly demutualised after a few false starts over the years, stand at a stately 2.7 per cent above their issue price. That's on top of the 5 per cent discount offered to former members of the Standard Life, who, like me, subscribed for additional shares ahead of the flotation. It's also on top of the free shares offered to members (effectively, in exchange for our membership of the old life-assurance society).

In a year's time, I will receive bonus shares representing a further 5 per cent of our holdings as a reward for short-term loyalty. Put all those little numbers together, and it's actually quite a decent return. Better than leaving the money in a building-society account, or, for that matter, in a Standard Life with-profits fund.

Well, what can I say except thank you, Standard Life. I know it's not as good as it would have been a few years ago when the bull market was going at full gallop, but I suppose it could have been worse. It could, perhaps, have ended up as an Equitable Life situation. Intriguingly, I'm told that there was just one member who got the maximum Standard Life additional share allocation of £50,000-worth of shares. Naturally, this was scaled down from some indeterminate larger sum, but it will still amount to a tidy quick profit for the lucky punter concerned.

I was quite surprised that there was just one application that got the full whack. I had imagined Standard Life members to be shrewd, affluent types who would have easy access to a five- or even six-figure sum for such an opportunity as this. Maybe they're feeling less shrewd and affluent as a result of what has happened at Standard Life over the past few years.

Either way, I still thought there was a bit more money than that about. My own application, needless to say, was rather closer to the minimum than that, and almost met in full, I'm happy to say.

Even if I had a spare £50K or £100K, I'm not sure I would have had the guts to go for the extra shares. A good example of how a couple of old clichés still have a bit of force in them: the richer get richer; and fortune favours the brave.

Sometimes, it favours the tardy, too. Having berated BAA/Ferrovial for mucking around with investors last week (they seemed to open and close their offer for shares as often as David Cameron invents bizarre and unconvincing political stunts), their offer is now well and truly open. Or, at least, it was the last time I spoke to the share registrars. So, if you haven't got the up-to-date forms and posted off your certificates or phoned your nominee stockbroker, I urge you to do so as soon as possible. I don't know what will happen to the BAA shareholder "refuseniks" who, for reasons of confusion or inertia or principle, refuse to accept the 935p-a-share offer. However, there must be some danger that you'll end up trapped in some zombie company with few rights and little early hope of seeing your money again.

For us BAA shareholders, it's all over. All we can do is grunt, lick our wounds and grab the money from Ferrovial. Like many others who have contacted me, I do feel disenfranchised, cheated even, because the BAA board made so clear for weeks their stance that 935p hugely undervalued their company, only to do a volte-face and accept the Spanish offer as if it were the most generous thing they'd been presented with this side of a duty-free shop.

I suppose we soon-to-be-former BAA shareholders will have the grim satisfaction of watching Ferrovial dealing with an Office of Fair Trading inquiry into the BAA monopoly of London's airports. Eventually, BAA will be broken up, and maybe the airlines will dig in their heels and resist attempts to charge more for landing at Stansted and Heathrow. The Ferrovial takeover is bad news for staff, shareholders and passengers alike. Just as the BAA board said it would be.

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