Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Technology Stocks : 3Com Corporation (COMS) -- Ignore unavailable to you. Want to Upgrade?

To: The Phoenix who wrote (38948)	2/4/2000 7:10:00 PM
From: Alski	Read Replies (1) \| Respond to of 45548

Gary, ...spinoff and must not have been acquired, within that period, in a wholly or even partially taxable transaction. <COMS acquisition of PALM via USRX already breaks this rule but he goes on to say that COMS would get favorable tax treatment anyway. I don't see how... this is an AND not an OR.> Did you skip a paragraph? ... a 2000 spinoff of Palm should pass muster because 3Com's acquisition of U.S. Robotics was fully tax-free. This means that 3Com acquired Palm Computing in a manner permitted by the statute and so not constrained by the five-year waiting period. <It doesn't mean that COMS can sell or seek a suitor or even announce that they've been bought starting the day after spin off.> Well, OK; but the jest of the article was that such an acquisition could not then be considered a pooling-of-interests and would therefor not qualify for favorable tax treatment. A big tax bite would substantially increase the acquisition cost and be a deterrent to such a non-pooling-of-interests transaction. The pooling rules provide that such treatment is unavailable in cases where... Therefore, a potential acquirer of 3Com may feel less than secure about its ability to annex the latter in a pooling until at least two years have passed from the time the spinoff is completed. FWIW...Alski