Shares were acquired in Centrica plc at demerger from British Gas plc (now BG Group plc – 'BG') on the basis of one Centrica share for every BG share held at demerger. The split between the post-demerger Centrica and British Gas shares was in the proportion Centrica 27.053% and British Gas 72.947%.
Shares in Centrica plc, acquired on demerger, will be treated as having a base cost for capital gains tax purposes of 64.25 pence each (ascertained by reference to the value of Centrica and BG shares on 17 February 1997 and calculated in accordance with provisions of Section 272 of the Taxation and Chargeable Gains Act 1992).
The base cost of any holding of BG shares on that date will be adjusted on the same basis. The relevant prices on the London Stock Exchange on 17 February 1997 were: Centrica 64.25 pence; BG 173.25 pence. The base cost of the pre-demerger British Gas plc shares was split between the post-demerger Centrica and BG shares in the proportion Centrica 27.053% and BG 72.947%.
The original flotation of British Gas plc shares took place on 8 December 1986. The opening price on that day was 135 pence, and the market capitalisation was £5.6 billion. On 18 February 1997 the market capitalisation of BG plc was £7.8 billion and of Centrica was £2.9 billion.