British Aerospace Act 1980

4 Financial structure of the successor company and its subsidiaries. U.K.

(1) If the aggregate nominal value of the shares in the successor company issued in pursuance of section 3 of this Act is less than the aggregate amount of the former Government investment in British Aerospace, a sum equal to the amount of the difference shall be carried by the successor company to a reserve (“the statutory reserve”).

(2) The statutory reserve may only be applied by the successor company in paying up unissued shares of the company to be allotted to members of the company as fully paid bonus shares.

(3) Notwithstanding subsection (2) above, the statutory reserve shall not count as an undistributable reserve of the successor company for the purposes of [F1 section 264(3)(d) of the Companies Act 1985]; but for the purpose of determining under that section whether the successor company may make a distribution at any time any amount for the time being standing to the credit of the statutory reserve shall be treated for the purposes of [F1 section 264(3)(c)] as if it were unrealised profits of the company.

(4) For the purposes of any statutory accounts of the successor company the value of any asset and the amount of any liability of British Aerospace vesting in that company on the appointed day (as at the date of vesting) shall be taken to be the value or (as the case may be) the amount assigned to that asset or liability for the purposes of the corresponding statement of accounts prepared by British Aerospace in accordance with section 10(6) of this Act in respect of the last accounting year of British Aerospace ending before the appointed day.

(5) For the purposes of any statutory accounts of the successor company the amount to be included in respect of any item shall be determined as if anything done by British Aerospace (whether by way of acquiring, revaluing or disposing of any asset or incurring, revaluing or discharging any liability, or by carrying any amount to any provision or reserve, or otherwise) had been done by the successor company.

Accordingly (but without prejudice to the generality of the preceding provision) the amount to be included from time to time in any reserves of the successor company as representing its accumulated realised profits available for distribution shall be determined as if any profits realised and retained by British Aerospace had been realised and retained by the successor company.

(6) References in this section to the former Government investment in British Aerospace are references to the aggregate of the following, that is to say—

(a) the amount included in the closing statement of the accounts of British Aerospace as representing the commencing capital of British Aerospace; and

(b) the capital amounts mentioned in section 2(b) and (c) of this Act;

and in this subsection “the closing statement of the accounts of British Aerospace” means the statement of those accounts prepared by British Aerospace as mentioned in subsection (4) above.

(7) References in this section to the statutory accounts of the successor company are references to any accounts prepared by the successor company for the purposes of any provision of the [F1 Companies Act 1985] (including group accounts).

Textual Amendments

F1 Words substituted by Companies Consolidation (Consequential Provisions) Act 1985 (c. 9, SIF 27), s. 30, Sch. 2