# how to post the QVCA & ZU merger that is cash & Stock

Member ✭✭
edited January 2019

• SuperUser ✭✭✭✭✭
edited May 2018

In this transaction you (should have) received 0.3098 shares of QVCA stock and \$9.375 cash for each share of ZU stock held.  According to the applicable Form 8937 from QVCA (http://libertyinteractive.com/pdfs/Form-8937-zulily-exchange.pdf) the QVCA shares had a fair market value of \$26.535 per share as of this transaction date.  That makes the value you received in QVCA shares equal to 0.3098 * 26.535 = \$8.221 per share of ZU stock held.  Your total receipt was then 8.221 + 9.375 = \$17.596 per ZU share.

My recommended procedure in Quicken includes 5 steps:
1. Sell the ZU shares for an amount to be determined below, then
2. Buy shares of QVCA leaving the net gain to your cash balance of \$9.375 per ZU share, then
3. Remove the QVCA shares just bought, and
4. Add the same number of QVCA shares back in with the same cost basis as just bought, but with acquisition dates corresponding original acquisition dates of the ZU shares.  This set of transactions should be done for each lot of ZU shares held (shares bought at one particular time for one particular price).
5. Once all lots are so processed, you are going to sell any resultant fractional share.
Determining the Selling and buying price:  There are three price ranges to consider.

c)  The final grouping is if your cost of the ZU shares was between those values - between \$8.221 and \$17.956/ZU share.  In that case, sell your ZU shares for \$17.956/share.  Quicken will determine a cap gain between \$9.375 and \$0.  You then buy the 0.3098 shares of QVCA (per ZU share) for a value that leaves the cash received in your account.  EXAMPLE:  If you had 100 ZU shares with a total basis of \$1,300 (\$13/sh) you would sell those 100 ZU shares for \$1795.60 and then buy 30.98 shares of QVCA for \$1,795.60 - \$937.50 = \$822.10 (\$26.535 / QVCA share) .

After the Sell and Buy, enter a Remove shares and Add Shares transactions to effectively correct the acquisition dates to the original ZU acquisition date.

When all lots are completed, sell any resultant fractional share for the Cash-in-lieu amount credited to your brokerage account.  In my examples above, you would be selling 0.98 shares for about \$25 (something close to the \$26.535 / share rate).

HTH
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