So I have shares in a company that now has spun-off one of its division into a separate company and that new company is also now publicly listed. I got one share in the new company for each four shares I had in the old company. But I have no idea how to record this event in PP. Could someone advise me, please?
Hey JulianF,
Basically it is a dividend of the spinning-off company and a purchase of shares of the span-off company for the amount of those dividends. Based on the tax system in your country the dividend transaction may be taxed or not.
Ok, thanks
Hey, I’m trying to figure out the best way of reflecting a spin-off in PP. If we do as you propose, the dividend data will be tampered and we will see a “fake” dividend that never reached our pockets 
Any fresher ideas?
What @Harry_Hirsch has described is the freshest, and will remain the freshest in the future.
So if I got 1 new share for every 5 old shares then the cost basis or value or dividend would be 1/5th of the my cost of the original shares? But it’s just an inbound delivery without any cash?
I just found this from another thread in the manual: Recording a spin-off operation - Portfolio Performance Manual
But I wonder if my way is cleaner because, as the article says, it avoids recording dividends that didn’t actually happen?
I thought about it a bit more last night, and although it isn’t actually a dividend it is kind of like a DRIP but where you re-inveset in another company.
Hey schultzter,
How to map a spin-off in PP is discussed here in many corners.
For me a spin-off is properly handled via a dividend and a buy.
Spin-off shares are just another form of dividends, you get money, however, you do not have a choice how to spend it.
The amount if dividends is the first price of the new share multiplied by the amount of new shares. After that you book a “buy” not an inbound delivery … in order to get rid of the cache in your account from the dividends.
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