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How do I enter spin off of D. E. Master Blenders from Sara Lee and stock splits and name change of Sara Lee?

Sara Lee spun off of D.E. Master Blenders then immediately under went a 1 for 5 reverse split and then changed its name to Hillshire Brands? This was a very confusing transaction for me to enter in Quicken!  There is no data for the closing prices of these stocks nor how to treat the cost basis.
    With the new information (http://phx.corporate-ir.net/External.File?item=UGFyZW50SUQ9MTQ2Nzg1fENoaWxkSUQ9LTF8VHlwZT0z&t=1
    ), I'll offer what I would do.  

    Caveat 1:  I am not a tax pro nor do I pretend to be one.  Consult your tax advisor!  Any information you get from me is worth less than you are paying for it.

    Caveat 2:  I am not and was not a SLE shareholder.

    1)  I do not care for Quicken's spinoff transaction.  Instead I would
    1a)  Enter a REMOVE Shares for all shares of SLE -- 6/28/2012
    1b)  For each lot of SLE, I would enter an ADD Shares for the SLE shares, same number of shares as for the lot, 30.19% of the lot basis.  I would enter an ADD Shares for CoffeeCo, same number of shares as for the SLE lot, 69.81% of the SLE lot basis.  Dates of Acquisition would match the dates applicable to the SLE lots.  Dates of transaction all 6/28/2012
    2)  For 6/28/2012, DIV from CoffeeCo for $3 / share
    3)  6/28/2019 -- SELL all shares CoffeeCo for 9.80 / share.  The SLE pdf description is not explicit if this produces a loss for some lots and only cites if this is a capital gain sale.  If you 9.80 represents a loss for some lot, I suspect you would sell at your basis for a net $0 gain.  See Caveat 1!
    4)  6/28/2012 -- BUY DEMB at 9.80/share (or whatever cash was generated by step 3)
    5)  6/29/2012 -- STKSPLIT SLE at 1:5 (check to make sure the date works adequately)
    6a)  6/29/2012 -- SELL any fractional shares of SLE at $29.03918/share
    6b)  6/29/2012 -- SELL any fractional shares of DEMB at $11.77010/share
    7)  Either Rename SLE to HSH, or have HSH acquire SLE (1:1)

    Other comments:  You may be able to process this using DEMB rather than the semi-fictional CoffeeCo, but I have tried to follow the pdf documentation provided.   I have not at this time worked through this process in a Quicken file, so the process may still require a little (or a lot) debugging.  This procedure is my preference which would be directed toward my general objectives.  Yours may differ -- perhaps substantially.

    HTH
    • HTH's process sounds reasonable to me but the only problem I have with it is that I received $5.68 for the 0.2 fractional share of SLE which works out to be $28.40/shr and not the $23.03918/shr he used.

      Can anyone explain why there is such a difference in the two prices?
    • old okie wrote:  "... the only problem I have with it is that I received $5.68 for the 0.2 fractional share of SLE which works out to be $28.40/shr and not the $23.03918/shr he used.

      Can anyone explain why there is such a difference in the two prices?"

      All I can say is that the 23.03918 came from the cited pdf write-up and was not justified in that document.  I have no justification for that beyond that source.  If your $5.68 was truly just for those 0.2 shares, I'd use that figure and not worry about it too much.  

      HTH (Hope this helps)
    • I didn't catch it at first but there was a typo in HTH figures.  The value should be $29.03918, as it is on the pdf document, instead of $23.03918.
    • re Typo:  Thanks.  I fixed it now in my original.
    • I am trying to work up a work-around for this in the Corporate Spin Off program in Quicken.  But I have a rather basic question that I can't seem to get through my brain and that is where it requests the "Enter the cost per share of the new security (the one that was spun off), on the date of the spin-off."  Is that the closing price of the new security, the cost basis per share, or what?!!!

      The other figure it asks, "the closing price of the old share" post spin off is straightforward.  It's the way they worded the last item about the "cost per new share" is what is throwing me for a loop.

      Thanks for any help.
    • So did anybody come across cost basis of this spinoff? What portion of Sara Lee was spunoff to create DEMB? I dont understand how do you guys process spinoff without cost basis!
    • Cosmos_modo: The SLE/HSH offered description (link above) comes around to 30.19% of the basis staying with SaraLee (Hillshire) and 69.81% being spunoff.

      old okie:  The spinoff computation in Quicken is really looking for fair market values for the two securities immediately after the spinoff.  Knowledgable users have complained about Quicken's nomenclaturefor years to no avail.  As I recall, the current help files are better than they used to be in that regard.  (See also: http://quicken.intuit.com/support/help/investing/how-to-record-a-corporate-spin-off-of--a-new-security/GEN82455.html and http://quicken.intuit.com/support/help/investing/recording-a-corporate-spin-off-of-new-securities/GEN82675.html)  What appears in the writeup are post-spinoff valuations of 5.70 for Sara Lee and 12.80 for 'Coffee Co'.  Those would be the values to enter for Quicken's spinoff transaction.  

      As a word of warning, I stated I did not care for that spinoff transaction.  What the transaction does is predate the spinoff effects to the dates of acquisition of the original shares.  Suppose you acquired shares of Sara Lee on 1/1/2005 and 2/3/2007 (two separate lots).  After using the spinoff action, you would have a RtrnCap transaction (for 69.81% of the SLE basis) and a Buy shares of 'Coffee Co' on each of those two dates.  While the current postions become accurately represented, a consequence of that approach is that it appears you owned both Sara Lee and Coffee Co beginning on those dates.  That misrepresents your holdings both as securitiy shares and as valuations from then until now.   

      It is possible to redate the twotransactions (for each applicable date) but then to get the acquisition date right for the 'Coffee Co' shares, your have to change the Buy Shares transactions to an Add Shares transactions.  Then you have to redo the RtrnCap transactions (which funded the prior Buy Shares) to recursive RtrnCapX transactions the apply the RtrnCap cash back into the same account.  At that point, I've decided it is often cleaner to simply do the Remove Shares  / Add Shares sequence - for both explanation and application.  

      If you are willing to live with the misreresented holdings over time, the off-the-shelf Coporate Spinoff should be fine.
    • How do you handle the $3 special dividend and the reduction in the CoffeCo's basis?  Do you sell an adaquate number of shares at $3/sh to equal the amount you received in the special dividend?  I am not sure but I think that would lower the cost per share of CoffeCo to the 9.80 as found in the write up so that your final basis in DEMBF is correct.

      Added entry - after looking at the HSH write up and comparing it to HTH's and q.lurker's entries, I should withdraw my quesion.  It is now clear to me what happens to the basis of DEMBF.  All should be well with the world now.
    • Finally getting organized to put this data into Q 2011.

      I discovered somehow in the past few weeks,  a download messed up my SLE holdings.

      It is showing the correct # of shares, with a price of $209.43.

      In Security Detail View,  it shows Return of Capital of $450,200.00!

      Date is 1990 when I acquired it.  My note on this says it was from a spinoff in 2006,  but I cannot find it anywhere in the transactions for either date.

      HOW do I correct this info if I cannot find it?
    • bhk:  Sara Lee spun off Hanes in September 2006.  Details (FAQ) are here:  http://www.hillshirebrands.com/InvestorRelations/~/media/SaraLeeCorp/Corporate/Files/PDF/InvestorRelations/SLE_HBI_Tax_Basis_Allocation_FAQs.ashx

      It would appear to me that you need to review and correct as necessary tthat transaction first, before addressing the DEMB spinoff.  

      In most spinoff cases, I am very leery of the downloaded transactions and prefer to get it right myself first.  Beware of any placeholders that you may have accepted.

      Alos on this case since you have owned Sara Lee a long tiime and there have been multiple spinoffs, I would be diligent in reviewing the data.  I do not know how well Quicken handles multiple spinoffs -- particularly though multiple generations of Quicken.  

      Questions and comments about the Hanes spinoff should be addressed in a separate discussion as it is not specificaly germaine to the DEMB spinoff (IMO).  I haven't looked for any discussion here on that event - but it pretty much predates any activity here.  

      Then again, https://qlc.intuit.com/post/show_full/aDZ9QInGir3OW4acmYYUkY
    • Thank you, SuperLurker

      I did not begin downloading from FI until May 2012, always entered manually including the spinoffs as you suggested.

      Also,   I discovered with the downloads it is best to be very careful as Q tends to do them improperly.

      Thankfully,  I have waited  for info on this forum, and have not touched SLE.

      I found the Transaction ret of capital and deleted the optional $ amount, so now $ are OK.

      BUT,  SLE in Sec. Detail is still showing a price of 209.43, and has shown $198+   since June 4, 2012, really weird.

      SO, I went in and deleted all the Price histories, typed in the Correct price on 6/29/12 , day of spinoff and everything is ok.....

      But high price is still showing $209,   and with next download will do the same for whatever reason.
    • bhk: Next download should do nothing to SLE - it doesn't exist anymore.  

      Make sure you have the correct ticker for Hillshire (HSH) and, if applicable, uncheck the security from being matched to an online security and let that matching get correctly re-established.
    I've been searching for the same and have posted on the accountant's forum. Unfortunately there doesn't seem to be much traffic in the subdivision of "Quicken" over there so please forgive this intrusion. If I may, I'd like to add a little more detail for those who may have the answer but not the details of this complicated spin-off. It's a bit lengthy so please bear with me. Here 'tis:

    Can someone please help me with the Sara Lee spin-off. Here’s the thumbnail from a trade mag in one of their industries; MeatPoulty.com

    DOWNERS GROVE, Ill. — The Hillshire Brands Co., the former Sara Lee Corp., has completed the separation of its international coffee and tea business.

    “The completion of the D.E Master Blenders 1753 spin-off is a significant milestone for shareholders and employees as it creates two pure-play companies that will pursue success independently,” said Jan Bennink, former executive chairman of Sara Lee Corp. and chairman of the board of D.E Master Blenders 1753. “I want to thank our employees around the world for their efforts in reaching this momentous occasion.”

    A distribution of all the common stock of the US subsidiary that held Sara Lee’s international coffee and tea business, known as CoffeeCo, was made to an exchange agent on behalf of the Sara Lee shareholders of record. After the distribution of the CoffeeCo common stock, CoffeeCo paid a $3 per share special dividend. After the payment of the special dividend, CoffeeCo merged with a subsidiary of D.E Master Blenders 1753 with CoffeeCo coming through the merger as a subsidiary of D.E Master Blenders 1753 and each share of CoffeeCo common stock was exchanged for one ordinary share of D.E Master Blenders 1753.

    Immediately following the separation, Sara Lee completed a 1-for-5 reverse stock split of its shares of common stock and changed its name to The Hillshire Brands Co. Hillshire Brands common stock will begin “regular way” trading on the New York Stock Exchange on June 29 under the ticker symbol “HSH.” D.E Master Blenders 1753 ordinary shares will continue to trade on the NYSE Euronext Amsterdam on an “as-if-and-when-issued” basis until July 9 when shares will begin “regular way” trading under ticker symbol “DE.”
    =============

    What I’ve done so far is post a reverse 1:5 split for 6-29-12. My next step was to change the name using 6-29-12. Then I was simply going to edit the stock symbol of the result of the name change since the window for name change only provides for the new name. This may be wrong.
    This would leave me with final task of providing for the $3 dividend and whatever entry necessary to create my share of the DE stocks which I believe I should treat as a spin-off (use the Spin-off entry).
    A concern is that since I already created an entry for the reverse split, I may not get the correct number of shares assigned for the DE spin-off. What’s more, I may run into the same problem with the special dividend. I’m driven along these lines based on the date of entry (6-29-12) and what Quicken has recorded a the number of shares at that time... which would be only a fifth of what I had on 6-28-12.
    I would be grateful to anyone who could lay out the correct sequence of entries necessary and – if I’m made an error so far – give me instructions on how to back myself out or correct what I’ve done.
    • I think what I need are the opening prices of Sara Lee and the price of Hillshire Brands in order to make the spin off in Quicken and get the cost basis allocated between the two, but I am unable to find that information so far.  In the Hillshire web site they say they will post that information soon.  

      After thinking it over, I think the best sequence in doing this is first add the special dividend on Sara Lee's account using the date of 6-29-2012 ,which is what Edward Jones used; then do the spin off using a date of 6-29-2012 to establish the cost basis of the two companies; then do the reverse split for Hillshire Brands.  I think that should get every thing to come out the way it should.

      I sort of did this using guestimates of the prices, but decided it would be best to wait till the official prices are published.  I had to go to the Transaction ledger and delete all the entries related to my spin off entries, and go into the Securities List to delete the Hillshire Brands and the DE Master Blenders listings.  That will enable me to get this completed once the official prices are posted.

      I would appreciate any other suggestions.
    I called the "information agent" (listed on the official announcement we received) and was given prices of HSH for the 29th:

     Opening of HSH 6-29: $28.49
    HSH lo : $27.56
    HSH hi : $29.59
    HSH close: $28.99
    Ave of L-H: $28.58

    The person I spoke to cautioned they couldn't give official advice but suggested I use either the opening price of $28.49 for HSH or the average of the high and low. I plan to use the average. Since the Quicken instruction window asked for the "post-split stock price" of the stock involved (SLE)... and SLE was now HSH... I assumed the price that should be used is one of the above for HSH. And, as I said, I plan to use the average $28.58.

    I also think you've got the sequence down correctly... but I'm not sure. It makes sense. I started with what I knew for sure (the reverse split) then thought of the consequences of being out of sequence. I may have to do what you did (delete transactions) unless someone else jumps in here with guidance that can save my entries and permit me to finish the job. I hate to leave this hanging.
    • Man....this is getting complicated.  I think the prices that jaygreg90 gave are after the reverse split.  My reasoning may not be correct but I think the spin off was before the split.  So...... the average price of 28.59 would be 5.716 before the 1 for 5 reverse split (28.59 divided by 5).  In my guestimate I was using 5.689 which was based on the opening price.  I think what is missing from the puzzle is what price of the DE Master Blenders do you use since it is the new security.  I used the price of 11.05 but that was just based on the first price I could find on it.  I guess we will just have to wait untill Hillshire Brands post all this info on their web site.

      Thanks for all your help.
    • I will add this information that I received from DE Master Blenders today in case anyone is interested:

      D.E MASTER BLENDERS 1753 will not start trading regular way until July 9th.

      Information regarding the allocation will be available after the D.E MASTER BLENDERS 1753 shares trade.  Our tax dept is working on putting the information together.  We should have something posted to the Investor Relations section of our website by the third/fourth week of July.


      Sincerely,


      LaShurn J Purnell
      The Hillshire Brands Company
      Manager, Shareholder Services
      3500 Lacey Road
      Downers Grove, IL  60515-5424

      (630) 598-8176 (t)
      (630) 313-2964 (f)
    I'm surprised no one else has posted here on this subject. To set myself up whatever posting necessary on the 9th, I fell back to a backup[ copy of my Qfile for 6-30 which was free from any postings involving SLE. Unless I hear otherwise, on the 9th I'll post the SLE dividend, then reverse split, then the name change. I haven't looked into how DE will be tracked daily in Quicken. Any ideas? I arranged to have my DE shared handled by Fidelity so  I assume I'll see daily updates in my Brokerage account even though it's not traded on US exchanges.
    • I am not sure how Quicken will tract DE Master Blenders but the ticker is DEMBF.  DE is already taken by John Deere.  I typed in DEMBF in Yahoo finance page and DE Master Blenders comes up.  Edward Jones also recognizes the company.  I believe Google does also.  There will be little data on it untill 9 July when it begins trading 'regularly'.
    • Came across the same problem as how to enter everything in fund admin software.
      I know the order for sure but lacking some data. So here how it should go:
      1. you enter spin off first. In order to do so you need cost basis of how much SLE got spun off to DEMB. This info remains unknown!!! and i cant proceed any further. You absolutely have to enter spin off first because it will allow you to properly enter stock split later.
      2. You enter SLE stock split 1:5
      3. Do name change SLE to HSH.

      Waiting for cost basis...if anyone knows please let us all know since it is getting a bit critical.
      Thank you all!
    • I seem to have everything in and it balances.  This is what I remembered that I did to get everything in.  I folowed the order of cosmos_mojo.

      Before I started, I  "Saved a Copy"

      For the spin out,
      I used for New shares issued per old = 1.0
      cost per origiinal (company) share = 19.19
      Cost per new (company) share = 11.307

      I did NOT click the taxable spin off.

      After this was completed.i changed the SLE to DEMBF
      I then put in the dividend, but it went against DEMBF.  I think I should have put this in before I changed the name to DEMBF

      When this was completed, the prices were all wrong, so I put in the prices for 6/30/12 of:
      hsh = 28.99
      DEMBF = 11.307


      The totals balance against my Fidelity  June 30 statement

      I have not yet tried to get the latest quotes yet.
      I have not checked the costs yet to see if they are reasonable.
    • re Larrysheets info
      I believe you were correct the way you had the special dividend.  It was supposed to have come from DEMBF.  

      It will be interesting to see how the cost basis comes out as I thought that since the spin off was done before SLE underwent the name change to HSH and the reverse split, one would use the HSH price divided by five so that the closing price would be comparable to the price at the spin off.  That would have been the price you would have used if the reverse split was not part of the deal.  Is my reasoning correct or should you used the full price of HSH?

      Just what dates does one use to get the prices from?  As the spin off took place after the closing on 28 Jun, is that the date that the spin off took place or do you use 29 Jun?

      I cannot find a closing price for SLE as it is no longer listed under that ticker.  But I would think it would be listed under the HSH ticker as that is what it changed it's name to.  If you look on the price history of HSH you get a closing price of 18.50 on 28 June.  If you use the date of 29 Jun, the closing price is 28.99.  So which one do you use?  Also, bothe of these prices are different than what larrysheets had in his post so that makes me more confused.

      The other problem is where do you get the price of DEMBF?

      Sara Lee sure did not plan this out very well except to befuddle all it's shareholders!!
    • I have the answer, but I'll be damned if I'll type it again. Why don't you have a cut and paste provision?
    • ahw45,

      "I have the answer, but I'll be damned if I'll type it again. Why don't you have a cut and paste provision?"

      I can copy and paste without problems (it is built into your web browser).  If you have copied it from somewhere, then just press Ctrl+V (like I just did for your statement above).  (select text and press Ctrl+C to copy).
    • What a freakin mess........... we should have sold SLE to save the trouble.

      Has anyone received the correct info that was due July 9 so we can do this spinoff fiasco properly?
    Patience, bhk. Patience. :-)

    SLE's "Information Agent" told me 2 to 3 weeks before the cost basis will be available, so... next week... perhaps.

    There's a lot of institutional shares of SLE slated for DEMBF that have to be sold 'cause their fund rules don't permit holding those overseas shares and that's depressing the stock price.... in my opinion. It does make one jumpy but... "good things come to those who wait."... sometimes. :-)
    • jaygreg90:   that means I cannot balance my linked  investment money market account,   for 3 weeks (?)

       not a good thing
    • I'm in the same boat, bhk. Maybe this week we'll know something. That's week 2.
    • I just went to the SLE website,   they have the info on the Hanes spinoff, but not this one.

      I sent them an email.

      Where did you get your " 3 week" info?

      thanx
    I believe that came from a conversation with an "Information Agent" (Donna) on 6-26-12 @ 10AM. Info Agent is Georgeson, Inc @ 888-666-2594