Fund Manager
Contact Us

Re: Merger

[ Q2 00 - Q2 01 Archive ] [ Current Message Board ] [ Archives ] [ Search ]

Posted by Mark on June 23, 2000 at 20:36:43:

In Reply to: Merger posted by Ray on June 23, 2000 at 10:58:45:

: Mark,

: On the Pfizer and Warner Lambert merger, say you have both stocks as a individual investments in a current portfolio and assume 100 shares of Warner yield 275 new shares of Pfizer. What is the best way to record while maintaining accurate cost basis for Pfizer?

: Attempt to record sale of 100 shares of Warner and purchase of 275 shares of Pfizer increases the cost basis for Pfizer. Please advise.

You have a couple of options:

1) Record a split in Warner for the 2.75 for 1. Change the name of Warner
to Pfizer. You'll then have 2 Pfizer investments.

2) Record a sell of 100 shares in Warner for your cost basis. Record
a buy in Pfizer for 275 shares for the same value. Your total cost basis
will remain the same.


Replies: | Search | Site Map | About Us | Privacy Policy