Fortive split off Stevens Holdings effective October 1, 2018 in a transaction meant to be tax-free to its shareholders. Stevens Holdings immediately merged with Altra (AIMC).
This action requires a simple spinoff transaction in the accounting software followed by a reverse stock split. The remaining basis percentage will vary depending on the number of Fortive shares accepted for the exchange. The exchange offer was over-subscribed. As a result the shares accepted for exchange were approximately 11% of the shares tendered. Odd lot shareholders were not subject to proration.
The Spinoff Entry
Go to Transactions > Spinoff or Accounting > Securities > Record stock split depending on the version of the software being used. . If you are unfamiliar with spinoff transactions you can get help at this URL: https://www.iclub.com/support/kb/default.asp?page=normal_spinoff
Here is the information you need to complete the spinoff.
Select Parent Security (or Parent Company) : Fortive (FTV)
Remaining Basis Percentage: (FTV shares remaining after exchange / shares before exchange) * 100
Cash received: See your broker statement for cash-in-lieu received
Spinoff Security (or Symbol of New Company) : Altra (AIMC)
Shares received : 2.2117 x (# of FTV shares accepted for exchange) (Remember to include fractional shares.)
For example, if you had 100 FTV shares accepted for exchange, you should receive 2.2117 x 100 = 221.17 Altra (AIMC) shares.
Price Per Share : 41.58 (Opening price on 10/1/18, effective date of merger)
Save the transaction and the spinoff portion has been entered.
The Stock Split Entry
Go to Transactions > Stock Split or Accounting > Securities > Record spinoff of securities
Company: Fortive (FTV)
Split ratio: # FTV shares after exchange for # of FTV shares before exchange
Cash for fractional share: See your broker statement
Save the transaction and the reverse split portion has been completed.
The cost basis allocation is dependent on the number of shares of FTV accepted for the exchange. This will likely be different for different FTV shareholders. The method listed above will prorate the exchanged FTV shares from all FTV tax blocks.