cgt on aggregation, page-5

If I have this correct, the implications of this cap return are

1. If your base cost is currently less than 18c then you will have a cap gain of (18 - old base cost) on which you pay CGT. Your base cost for future sales of the merged shares will then be zero.

2. If your base cost is above 18 c then no immediate cap gains tax to pay but your new base cost for CER will be (old base cost - 18) cents, or 5.8 times this in the merged entity.

As example, my base cost is 22c. So my new base cost for merged entity is 5.8 x (22-18) = 23.2c. If I sell the new merged shares shortly after listing for say $2.50 then I will be up for Cap Gains of $2.27 per share (or equivalent to 39 cents per original CER share).

Someone please correct if I am barking up the wrong tree.

Neil