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PCS Convert short term to long term profits using MetroPCS reverse merger


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Convert short term profits to long term profits using MetroPCS reverse merger

 

This is a special situation of MetroPCS reverse merger with T-Mobile.

Today shareholder approved this reverse merger.

As per this merger agreement, On April 30th

 

MetroPCS' stockholders of record as of the close of business on the closing date, which is expected to be April 30, 2013, will receive an immediate $1.5 billion aggregate cash payment, or approximately $4.06 per share (prior to the reverse stock split that will occur in connection with the closing of the proposed combination), as well as an approximate 26% ownership stake in the combined company. 

 

At current stock purchase  price of 11.60..on 30th you will get $4.06 in one time dividend.

So you can pay long term profit on dividend and get use the $4.06 as loss towards your short gains this year.

I dont think their is lot of risk for this stock going down after before May 1st as this is trading on lowest part of valuation. If 4 days is too risky you can try this approach  to buy on 30th and sell on 1st.

On May 1st this stock will trade with new symbol with reverse split price of 2 PCS stocks combined and taking out cash dividend paid and the price will be average of past 5 days closing price that is closing price of next 5 days starting today 4/24

 

I tried to remove this post but its not allowing me.. It looks like this scenario wont work as their is already a clause in tax for dividends thatprevents thismeet holding period requirements: You must have held the stock for more than 60 days during the 121-day period that begins 60 days before the ex-dividend date. The ex-dividend date is the first date following the declaration of a dividend on which the buyer of a stock is not entitled to receive the next dividend payment. For calculation purposes, the number of days of ownership includes the day of disposition but not the day of acquisition.[1]

 

 

 

 

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I don't understand.

 

If you only hold it for a few days it wouldn't be a qualified dividend. So you wouldn't get any improvement in tax rate.

 

Is that incorrect?

 

 

You are correct! I was under wrong impression that all dividends are treated same, I didn't see this clause..my bad

My scenario is different as i was working on this special situation and holding this stock more than 60 days..thought this is a special sitatuion can be used by other..I guess someone already thought about it and plugged it!

 

"meet holding period requirements: You must have held the stock for more than 60 days during the 121-day period that begins 60 days before the ex-dividend date. The ex-dividend date is the first date following the declaration of a dividend on which the buyer of a stock is not entitled to receive the next dividend payment. For calculation purposes, the number of days of ownership includes the day of disposition but not the day of acquisition."

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