BioAmber Inc (fka BIOAQ)

[fireballka7]

Sec. 338

In a stock acquisition transaction, if the acquisition is a qualified stock purchase and an election is made under Sec. 338, the stock acquisition is treated as an asset acquisition for tax purposes. Under this scenario, the buyer will have the privilege of a step-up in basis of the seller's assets. At the closing of the transaction, the seller's assets will be revalued and stepped up to fair market value (FMV) on the buyer's balance sheet, which will closely reflect the purchase price. The buyer allocates any amount of the purchase price that exceeds the FMV of the asset acquired to goodwill on its balance sheet.