the creation of a spin-off
in response to an adverse development in the parent firm) which have received significantly less attention in the literature than incumbent-backed and opportunity spin-offs
An examination of the identities of the sponsored spin-off
blockholders reveals they are primarily sophisticated investors such as Warren Buffett, the Gabelli Fund, Morgan Stanley, and Forstmann Little.
To diminish the gap between technology and market, which is a critical part of the spin-off
process, most universities have established offices/institutions (technology transfer offices, etc.
Finally, section 355 also imposes other requirements for tax-free treatment in a spin-off
in addition to those that are subject to the new ruling policy, such as the five-year active business requirement.
United Communications Group has found a way to keep the staff of its highly successful and profitable publishing company in place as it pours millions into its two spin-off
, start-up IT companies.
Under the proposed regulations, stock in purchased subsidiaries was usually considered disqualified stock, thereby preventing the tax-free spin-off
of subsidiaries purchased by Distributing during the five-year period.
In addition, the vague scope of the term "plan (or series of related transactions)" creates substantial uncertainty for taxpayers, which has a chilling effect on legitimate, commercial spin-off
For a spin-off
to be considered nontaxable, there must be a valid corporate business purpose for the transaction and the spin-off
cannot be primarily a device for distributing earnings and profits (E&P).
Generally, the IRS will be taking a more active role in scrutinizing the motivations and purposes of the spin-off
than in the past.