The
Asset Sale Offer is being made pursuant to the indentures governing the Notes (collectively, the "Indentures") and an Offer to Purchase, dated February 27, 2018 and related Letter of Transmittal, which more fully set forth the terms and conditions of the
Asset Sale Offer.
M2 EQUITYBITES-January 11, 2016-HomeFed declares higher principal amount and extension of
Asset Sale Offer for USD619,225 senior notes due 2018
has closed three
asset sale transactions in the last month that have generated around $100 million in cash.
Furthermore, unlike a stock sale, an
asset sale triggers both a corporate level tax and a shareholder level tax.
Even after the 2003 Tax Act's tax reductions, this double taxation of the purchase price paid to a C corp in an
asset sale produces a 53 percent tax rate after taking into account the effect of California tax.
the
asset sale deemed to occur as a result of a Sec.
S persons, each of whom owns at least 10 percent directly or indirectly), or a Foreign Personal Holding Company (FPHCO), some or all of the deemed
asset sale gain could be Subpart F or FPHCO income.
In the second quarter, HCR sold 21 assisted living residences to Brookfield, Wisconsin-based Alterra or placed them in escrow awaiting funding as part of a previously announced
asset sale agreement covering 28 facilities.
From a tax perspective, individual owners of a C corporation prefer a stock sale over an
asset sale, because it produces only one level of tax (shareholder), not two (corporation and shareholder).
Historically, a seller would report an
asset sale using the installment method.
