Question: I need assistance in how to record the spinoff of Tegna, Inc from Gannett, which took place at the end of June, 2015.
I had 400 shares of Gannett, with a LT cost basis of $10,738.50. I now have 400 shares of Tegna, with a cost basis (as provided by my broker) of $8,777.85, and 200 shares of Gannett Spinco, Inc., with a cost basis of $1,960.65. The total cost basis of the 2 companies equals the original cost basis. No cash payments were involved. How do I record this spin-off in IAM?
Answer: Gannett announced in August 2014 that it planned to separate into two publicly traded companies: a broadcasting and digital company that will operate under the name TEGNA and a publishing company that will retain the name Gannett Co., Inc. Under the terms of the transaction, Gannett shareholders retained their shares of Gannett, which was renamed TEGNA, and also received one share of new Gannett for every two shares of Gannett stock they owned. New Gannett shares also begin “regular way” trading today on the NYSE under the symbol GCI.
To enter this in Investment Account Manager, follow these steps...
1. Select the Asset Library Menu | Current Asset Library
2. Select Gannett and then the Edit Tab
3. Edit the symbol to TGNA (Tegna)
4. Edit the name to Tegna Inc.
5. Save changes and close the Current Asset Library
6. Select the Transactions Menu | Global Transactions | Spin-off choice
7. Enter for date of the spin-off: 6/29/2015
8. Enter for security symbol of issuer: TGNA
9. Enter for security symbol of spin-off: GCI
10. Enter for market price of GCI on day of spin-off: $14.13
11. Enter for number of spin-off shares received for each share of the issuer held: 0.5
12. Enter for percentage of original cost basis retained by issuer's shares: 81.7418
13. Percentage of original cost basis allocated to spin-off shares: will show as 18.2582
Once the above information has been entered, IAM will list those portfolios that will be adjusted by the spin-off activity. Use the Print button to print an audit report. Then use the 'Select All' button to check all portfolios shown. Then select the button to 'Apply to Selected Portfolios'.
Verify all portfolios have been properly adjusted by printing the Security Basis Report.
For more information on this spin-off from the Tegna Inc. web site: http://investors.tegna.com/phoenix.zhtml?c=84662&p=irol-irhome