Pembina has offered to acquire the shares of Veresen, as per this post in the Pembina thread. I'm trying to understand the tax implications if I exchange my VSN shares for cash or for Pembina shares. From my reading of the management information circular:
a) If I go with cash, there will be a capital gain/loss
b) If I exchange my VSN shares for Pembina shares, the mgmt info circular says it will be considered a tax deferred exchange as per Section 85.1 of the Tax Act. My assumption is that this exchange is not a taxable event (until I sell the Pembina shares).
For option b) above, is my understanding correct?
Veresen (symbol VSN-t)
Re: Veresen (symbol VSN-t)
Correct. You would be deemed to have received proceeds of disposition equal to your cost base, so no gain or loss to report on the Veresen shares.
The cost base of your Veresen shares would become the cost base of the Pembina shares received. (If you already own some Pembina shares, your average cost will have to be recalculated.)
The cost base of your Veresen shares would become the cost base of the Pembina shares received. (If you already own some Pembina shares, your average cost will have to be recalculated.)
Re: Veresen (symbol VSN-t)
Thanks David.
Looking back on my history with these shares, it's going to be a nightmare to calculate the capital gain when I eventually sell. The shares were originally purchased as Fort Chicago LP (which had a ROC component), and were subsequently exchanged for Veresen, and will now be exchanged for Pembina. Thank goodness for spreadsheets.
Looking back on my history with these shares, it's going to be a nightmare to calculate the capital gain when I eventually sell. The shares were originally purchased as Fort Chicago LP (which had a ROC component), and were subsequently exchanged for Veresen, and will now be exchanged for Pembina. Thank goodness for spreadsheets.
Re: Veresen (symbol VSN-t)
I go back to Fort Chicago days too, but in my case they're all in an RRSP.