SRNOC change of conversion terms, page-23

Just been reading up on tax rules re options and conversion.. it does state that the CGT will apply from the day you convert to heads, but it also states in the note below that you are to disregard any capital gain or loss as a result of the conversion itself.

Therefore if you sold them straight away, this infers that the 40% arbitage is indeed free money. Anyone have actual experience with selling/exercising options in this way, and am i interpreting this correctly?

Answer 3

• The shares or units you acquired when you exercised the rights or options are subject to CGT.
• The acquisition date of the shares or units is the date you exercised the rights or options.
• The first element of the cost base and reduced cost base of the shares or units is the sum of the amount you paid for the
  • rights or options
  • shares or units when you exercised the rights or options.

Note: Disregard any capital gain or loss you make from exercising the rights or options to acquire those shares or units.