Hi Barney
This is not directed at you as I think you understand the CGT implications.
There are three different scenarios.
There is a difference between selling on market and accepting the offer.
In both scenarios, you get the CGT discount on the sale of your NWE shares, if held longer than 12m and you are an investor.
The difference is that if you sell your NWE shares on market, you get $$.
Pretty obvious, i know.
You have created a CGT event and have a liability.
You can then put part of the $$ away to pay your CGT and do whatever you want with the rest.
If you accept the offer, you get MIN shares and no cash.
If they do not get to 80% acceptances, you will pay CGT on accepting the offer, based on the MIN share price at the time.
You get no $$ to pay the CGT bill you will have.
You are now a MIN shareholder and have no cash for whatever you wanted.
If you are a large holder, such as barneydigs, it is very likely you will have to sell MIN shares to pay for your CGT bill.
This in itself will create another tax liability.
You will not get a CGT discount on the sale of the MIN shares as you have not held them for 12 months.
It is likely that there will be others selling MIN at the same time, for the same reasons.
This will put pressure on the MIN price, and probably push it down.
If MIN get 80% of NWE, you get rollover relief.
At the moment, this seems unlikely but you need to make your own assessment.
This means no CGT is payable until you sell your MIN shares.
The cost of your MIN shares is what you paid for your NWE shares.
There is no CGT to pay until you sell your MIN shares.
This is the general position with CGT, you need professional advice for your specific circumstances.
Your personal financial circumstances affect your CGT liability.
If you are unsure of your possible CGT liability, get professional advice.
Don't rely on the internet.
Not meant to be financial advice - DYOR.
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