Demerger

This topic has 3 replies, 2 voices, and was last updated 6 years ago by John Moffat.

Viewing 4 posts - 1 through 4 (of 4 total)

Author

Posts
September 5, 2019 at 9:42 am #545053
toushiga
Participant
- Topics: 424
- Replies: 171
Hello Sir, for the answer to the PYQ march/june 2019 Q3 part (a)
Advantage of demerger
:”Newimber CO ‘s shareholder will continue to own both companies. If shareholders are concerned abt th3 diversification of their portfolio, this will remain unchanged.”

What is the remaing uncharged in the paragraph referring to? What is the meaning?
September 5, 2019 at 5:20 pm #545157
John Moffat
Keymaster
- Topics: 57
- Replies: 54860
It refers to the diversification of their portfolio. If they want to diversify then the demerger won’t make things any different.
September 6, 2019 at 11:30 am #545250
toushiga
Participant
- Topics: 424
- Replies: 171
” In return for 40% of the issued share capital of Newimber Co,its current shareholders will received 100% of the issued share capital of Poynins Co”

How its actually work? Is it all the Newimber Co SH will receive 100% of the share of Poynins Co by share for share exchange based on the respective holding and based on Poynins Co ‘s share price?

For example, holding One Newimber share worth $1 will be reimbursed with one Poynins Co share worth $0.40?

Thank you.
September 6, 2019 at 4:18 pm #545315
John Moffat
Keymaster
- Topics: 57
- Replies: 54860
It is as is stated in the question.

40% of their existing shares will be cancelled. In return they get 100% of the shares in the new company.
Author

Posts

Viewing 4 posts - 1 through 4 (of 4 total)

The topic ‘Demerger’ is closed to new replies.