Sandy McIntyreFording Canadian Coal Trust (Inc Trust)FDG.UN.TOCOMMENTDec 16, 2005
If you bought this on the basis that coal is a good source of energy over the next 5/10 years and you are going to generate cash flow off the business, then don’t worry about fluctuations. Sold the bulk of his holdings.
Being acquired by Teck Cominco (TCK.B-T). If you are holding this in a taxable account, there are some very negative consequences. In an RRSP or RIF you can avoid the tax consequences. He sold the majority of his holdings into the market prior to the transaction.
Being acquired by Teck Cominco (TCK.B-T). Arbitrage companies were forced to sell. There is a financing gap and Merrill Lynch (MER-N) is part of that, so the market is concerned. The deal could fall apart.
If held in an RRSP, you could continue holding. If it's in a taxable account, consider selling the units before the new deal gets done. Take it as a gain as opposed to the tax treatment that will supposedly come on the consummation of the deal. (Editor’s note. Check with your broker.)