There are two basic structures, or means, for a parent company to conduct a The second tax-free spinoff method is for the parent company to offer existing shareholders the option to exchange their shares in the parent company for an equal proportion of shares in the spinoff company. Tax-free spinoff refers to a corporate action in which a publicly traded company spins off one of its business units as an entirely new company. Thus, shareholders have the choice of maintaining their existing stock position in the parent company or exchanging it for an equal stock position in the spinoff company.
A: Trading in Prosus N Ordinary Shares (Prosus N Shares) issued under the Naspers M Share Capitalisation Issue will commence at 09:00 (CEST) on Euronext Amsterdam and at 09:00 (SAST) on the JSE, on Wednesday, 11 September 2019 on an "as-if … A taxable spinoff is a divestiture of a subsidiary or division by a publicly traded company, which will be subject to capital gains taxation. Prosus businesses pay taxes where they operate. The new group listed on Euronext Amsterdam on 11 September 2019 and is called Prosus. A carve-out is the partial divestiture of a business unit in which a parent company sells a minority interest of a subsidiary to outside investors.

The first method of conducting a tax-free spinoff is for the parent company to distribute shares in the new spinoff to existing shareholders in direct proportion to their equity interest in the parent.

Prosus is a global consumer internet group and one of the largest technology investors in the world A Euronext Amsterdam listing is expected to attract incremental tech investor capital which is well-aligned to our growth ambitions We believe the new listing will also help to reduce Naspers' outsized weighting on the JSE which has been caused by the group's rapid growth.
If a stockholder owns 2% of the shares of the parent company, he receives 2% of the shares of the spinoff company. Accepting shares in Prosus will trigger a tax event – requiring the payment of tax on what in for some are spectacular capital gains. Taking actions to address market dynamics The manner in which a parent company structures the As a global company, we recognize that the tax we pay is an important element of our broader economic and social contribution to the countries where we operate. The period for Elections for Naspers N Ordinary Shares (instead of Naspers M Ordinary Shares and, ultimately, Prosus N Ordinary Shares) will close at 12:00 (SAST) on Friday, 13 September 2019 (the Record Date).Shareholders holding Naspers N Ordinary Shares in dematerialised form are required to notify their CSDP or broker if they wish to make an … We believe that opening up investment to a broader category of investors while reducing our JSE weighting will help to maximise shareholder value over time. Are you perhaps a Naspers or Prosus shareholder? With the second scenario, the shareholders are free to choose whichever company they believe offers the best potential As of the end of day Thursday, Sept. 19, Naspers shares were down 36% from the pre-spin price -- a full 10 percentage points greater than the 26% spinoff of Prosus. If you answered yes to one of these questions, please read further.

There are any number of reasons why a company might wish to spin off a subsidiary company or division, ranging from the idea that the spinoff can be more profitable as a separate entity to the need to divest the company to avoid antitrust issues.

Since the parent company and its shareholders may be subject to sizable capital gains taxes if the spinoff is considered taxable, the inclination of companies is to structure a spinoff so that it is tax-free. The taxable status of … While a company's first responsibility in determining how to conduct a spinoff is its own continued financial viability, its secondary legal obligation is to act in the best interests of its shareholders. The manner in which a parent company structures the spinoff and divests itself of a subsidiary or division determines whether the spinoff is taxable or tax-free. A spinoff is the creation of an independent company through the sale or distribution of new shares of an existing business or division of a parent company. It also serves as a break-down of the different tax … This article can be seen as a summary of what the transformation, which Naspers is currently going through, actually entails. The offers that appear in this table are from partnerships from which Investopedia receives compensation. A reverse stock split consolidates the number of existing shares of corporate stock into fewer, proportionally more valuable, shares. Are you curious about what the Naspers unbundling transaction is actually about? Prosus’ approach to tax Prosus aims to contribute positively to the communities within which it operates. On 25 March 2019, Naspers announced its intention to list its international internet assets on Euronext Amsterdam with a secondary, inward listing on the Johannesburg Stock Exchange in South Africa.