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petemantx

02/25/14 7:53 PM

#2805 RE: sons4 #2803

Edit: Just read justfacts... and he said the same thing I am in this post.

I am saying if they, say MSFT, are buying the company for cash, you will get ONLY cash and have to then purchase MSFT from your new cash balance. However, you will be liable for taxes on the entire amount of your profit from the sale (except for IRA's) in the year the deal is finalized and for many that is going to be a whopping large sum.

Whatever proceeds are in stock of the buying company, in this case MSFT, are not liable for taxes until you sell such stock. Thus, in many cases a stock buyout is preferred so that each individual investor can determine what best suits his situation as to taxes as to when he sells the stock.

Justfactsmam

02/25/14 7:55 PM

#2807 RE: sons4 #2803

Everything depends upon the specific deal. All is negotiable...what is not negotiable are the final terms as they apply to shareholders and payment for their shares. No choice between cash or stock in the acquiring company UNLESS the deal is crafted that way giving a specific choice and % of stock or cash etc. But "choice" is very unusual option.