How do I handle the Merger of MTU and VOC

I have a holding of MTU which has now merged with VOC, now trades as VOC at a different price and quantity. Should Sharesite have automated this change?
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  • Hi Gavin,

    Thanks for your email! Unfortunately our corporate action data does not include all of the necessary information to record the M2/Vocus merger. Please find the steps below to assist you in recording the merger manually in your portfolio.

    To record the merger we encourage our Australian clients to:

    1. Remove M2 from your current portfolio by recording a sale at the cost base so that no CGT is calculated. If you have several trades against your M2 holding, the easiest way to obtain the cost base figure is via the Historical Cost Report.

    2.Record your newly acquired Vocus shares using an opening balance transaction (as opposed to a buy transaction) based on the date that you acquired the shares. This allows you to enter a cost base which is used for CGT reporting (the original cost base of your M2 shares in this case), but performance reporting will be calculated based on the change in market value from the opening balance date.

    Important to keep in mind! Using this approach makes for your CGT report to not account for any CGT discount if you choose to sell your Vocus shares in the next 12 Months. Sharesight does not have an ideal solution for this at present unfortunately - the workaround solution would be either to backdate the opening balance date as required when you run the CGT report or to download the spreadsheet version of the CGT report and make a manual adjustment.

    Please note that the information above is provided for your assistance regarding use of Sharesight and does not constitute specific taxation advice and should not be relied upon as such.

    I wish you a lovely day!

    Cheers,

    Emma
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  • Hi
    Just a note that I have just done this adjustment, and using an opening balance (rather than a purchase) for VOC shares results in some strange behaviour in the capital gain column of the overview page. It picks up the price of the VOC shares as the price on the conversion date rather than the cost base that you have entered.
    Doing it as a purchase seems to solve it, but would appreciate your thoughts.
    Steve
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