Re: Buy out/Merger of two companies

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Posted by Mark on January 17, 2007 at 20:05:14:

In Reply to: Buy out/Merger of two companies posted by Willis Dillon on January 17, 2007 at 17:03:10:

: I don't know if I recorded the recent buyout of BellSouth by AT&T in my portfolio correctly or not. I own both of them.
: I treated the buyout of BellSouth's total value as a return of Capital. I then took the value received and used it for the total purchase value of the new AT&T shares.
: Other than the cash for partial share of AT&T, I think this should then be regarded by FM as a non-taxable event.
: I didn't see any other way to handle it--If there is please advise.

Hi Willis,

Another way is to use a split transaction. The ratio for a split can be anything you want, so you can record a split with a ratio of:

for

You can then just rename this investment to the new name. This has the added benefit of keeping all your historical returns/buys/sells, instead of starting over with a single purchase in a new investment.

Thanks,
Mark
--
Fund Manager - Portfolio Management Software

Replies:

• Re: Buy out/Merger of two companies Willis Dillon 22:50:24 01/18/07 (1)
  • Re: Buy out/Merger of two companies Mark 23:25:29 01/18/07 (0)