Spinoff

DETROIT -- General Motors Corp., the world's largest automaker, completed its separation from No. 1 auto-parts maker Delphi Automotive Systems Corp. yesterday with the distribution of $9.3 billion in Delphi shares.GM, which handed its investors an 80.1 percent stake in Delphi and gave another 2.2 percent to a pension trust, now owns no Delphi shares. GM rose 50 cents to $69 on the New York Stock Exchange after being adjusted for the distribution, which was valued at $14.33 per GM share. Delphi slipped 87.5 cents to $19.625.

Members of the Maryland Association of Certified Public Accountants are answering readers' tax questions through April 15. See below for how to submit a question.I bought Marriott stock some years ago, and since then it has split and then spun off a bunch of new companies. I would like to sell the Marriott stock, but have no idea how to figure out what its basis is after all these spinoffs. What do I do?First, the basis of the original purchase cost of the Marriott stock is split in half for each share due to the 2-for-1 split.

Members of the Maryland Association of Certified Public Accountants are answering readers' tax questions through April 15. See below for how to submit a question.I received some shares through a tax-free spinoff and payment for the fractional share. How do I report this?A spinoff is a distribution to stockholders by one corporation of the stock of a controlled subsidiary. As you stated, your receipt of these shares is nontaxable. You should have received a statement from the distributing corporation stating that the spinoff does qualify as a nontaxable event for its shareholders, and this statement should be attached to your income tax return.

MURRAY HILL, N.J. -- Lucent Technologies Inc. set a 2-for-1 stock split yesterday after the phone-equipment maker's share price more than tripled since its spinoff from AT&T Corp. nearly two years ago.The company also formed a $100 million venture-capital fund to invest in new wireless, semiconductor and software technologies. Lucent expects these fields to complement research at its renowned Bell Laboratories division, which invented the laser and the transistor.Lucent has rewarded investors with seven quarters of record revenue and profit that has topped expectations since its spinoff in April 1996.

Members of the Maryland Association of Certified Public Accountants are answering readers' tax questions through April 15.Q: How should I report the sale of 44 shares of NCR stock that I received as a result its spinoff from AT&T? I got a certain number of NCR shares for the many shares of AT&T I had, so I didn't really pay for anything.A: AT&T should have provided you with some information when the spinoff occurred. Basically, your tax basis in the NCR stock will be a portion of your tax basis in the AT&T stock you held immediately prior to the spinoff.

Esther Rolle, 78, who played the maid in the hit 1970s sitcom "Maude" and the strong-willed mother who kept her ghetto family together in the spinoff series "Good Times," died Tuesday at a hospital in Culver City, Calif., her spokesman Larry Calhoun said.The cause of death was not determined, but she had diabetes and was undergoing dialysis, Mr. Calhoun said.A crusader against black stereotypes in movies, Ms. Rolle said in 1987 that she was intent on shattering the image of a "Hollywood maid with the rolling of the eyes" who doted on her white charges but ignored her own children.

Members of the Maryland Association of Certified Public Accountants are answering readers' tax questions through April 15.Q: I bought a boat in February 1996 that under IRS rules meets the requirements for a dwelling. Can the interest on the loan be written off? How about the sales tax on the purchase of the boat? Storage fees, since I keep it at a marina? What forms would I use to write off anything pertaining to my boat? Can any other items be written off that I have not mentioned?A: The interest that is paid from the boat mortgage can be deducted on Schedule A, Itemized Deductions, as an interest deduction on a home.

NEW YORK -- In a move that had been anticipated, PepsiCo Inc. said yesterday that it will spin off its restaurants and possibly sell its restaurant supply company to focus on its more profitable and promising soft drinks and snacks.Pepsi will shed its biggest line of business -- KFC, Taco Bell and Pizza Hut -- which it has assembled over two decades, because it has dragged down earnings and chewed through much-needed capital. It didn't give the terms of the spinoff, though it expects to complete it by year-end.

DETROIT -- General Motors Corp.'s board yesterday approved a spinoff of Electronic Data Systems, ending an uneasy 12-year marriage and freeing the computer-services business to hunt for acquisitions.EDS, founded in 1962 by Dallas billionaire Ross Perot, said the spinoff will result in the elimination of up to 5,000 jobs, including 2,200 firings, in the next few months.Plano, Texas-based EDS agreed to make a one-time payment of $500 million to GM, less than some analysts predicted that it would cost to break free from the nation's biggest automaker.

KANSAS CITY, Mo. -- H&R Block Inc. said yesterday that it has postponed the spinoff of its remaining stake in CompuServe Corp., gambling that the money-losing unit will be able to stem customer defections to cheaper Internet services.The company said it still intends to separate CompuServe from its tax-preparation business. The first step is boosting the unit's stock: Since H&R Block sold a 20 percent stake in an initial public offering in April, CompuServe's shares have plunged 56 percent.

The Baltimore area has seen corporate headquarters disappear before, but the loss of Black & Decker in a corporate merger could hurt more than most in terms of prestige, spinoff jobs and charitable giving, local leaders say. Allan Tibbels, co-executive director of Sandtown Habitat for Humanity, was left wondering what the proposed deal will mean for his nonprofit, which rebuilds housing in West Baltimore. The organization has benefited from Black & Decker's charitable contributions for years, as the manufacturer has donated power tools, employee volunteer hours and funding, Tibbels said.

Actor Joaquin Phoenix says goodbye to film, hello to music Joaquin Phoenix says he's "not doing films anymore." He made the announcement Monday at a fundraising event for Paul Newman's camps for kids. Extra's Jerry Penacoli asked "Are you serious?" Phoenix answered, "Yeah. I'm working on my music. I'm done. I've been through that." Phoenix's rep confirmed the news to Extra with the response, "That is what he told me." The 34-year-old performer gave no further details on his career plans - but he has been working on a record for some time with Britain's The Charlatans, People reports on its Web site.

Last week's $400 million deal by Teva Pharmaceutical to buy CoGenesys Inc. will enrich CoGenesys insiders and create a great launching pad for the Rockville company's drugs. Some shareholders of Human Genome Sciences, however, wonder why they aren't getting more of the action. Two years ago Human Genome's president and chief financial officer started CoGenesys by taking some of Human Genome's best scientists and ideas out the door. Now, in this edition of "Flip This Biotech," they and others who invested with them will walk away with most of the money.

Exit, the diplomat. Enter, the operator. After months of speculation, Time Warner Inc. announced this week that Jeffrey L. Bewkes, the chief operating officer, will succeed Richard D. Parsons as chief executive at the end of the year. The announcement, though far from unexpected, could pave the way for major changes at the world's largest media company, which owns Warner Brothers, AOL, Time Inc. and CNN. Parsons has placed a premium on stability in a company that has been long on upheaval.

NEW YORK - Owning Liberty Media Corp. has always been about owning a piece of John C. Malone. As a leading cable TV mogul, the cunning and charismatic Malone can usually be expected to do something daring - and profitable. But for the past four years, Liberty Media's chairman, chief executive and all-around guru has been unable to move his stock much above the low double-digits. It touched $25 before the Internet bubble burst in March 2000. So today, Malone will try to do what many media owners are trying to do these days: "unlock" value from his holdings, by spinning off Liberty's 50 percent stake in Discovery Communications Inc., the Silver Spring, Md. company that is one of the world's most treasured cable-TV properties.

Cendant Corp. said yesterday that it completed the spinoff of its mortgage and locally based PHH Arval fleet management businesses to shareholders. Stock in the newly combined company, called PHH Corp., is expected to start trading today on the New York Stock Exchange under the symbol "PHH." It's unclear whether the spinoff will have any immediate impact on PHH Mortgage, formerly Cendant Mortgage, based in Mount Laurel, N.Y., and PHH Arval, the fleet management services business based in Sparks.

HOUSTON - Reliant Energy Inc., the biggest electricity company in Texas, said yesterday that federal regulators have approved a new holding company structure, a step needed to complete the spinoff of Reliant Resources, its energy-trading arm. Reliant Energy will be renamed CenterPoint Energy, a natural gas and power-delivery company. Reliant Resources shares held by its parent will be distributed to investors in coming weeks, completing a separation that began last year, the company said in a statement.

DETROIT -- General Motors Corp., the world's largest automaker, completed its separation from No. 1 auto-parts maker Delphi Automotive Systems Corp. yesterday with the distribution of $9.3 billion in Delphi shares.GM, which handed its investors an 80.1 percent stake in Delphi and gave another 2.2 percent to a pension trust, now owns no Delphi shares. GM rose 50 cents to $69 on the New York Stock Exchange after being adjusted for the distribution, which was valued at $14.33 per GM share. Delphi slipped 87.5 cents to $19.625.

Members of the Maryland Association of Certified Public Accountants are answering readers' tax questions through April 15. See below for how to submit a question.I received some shares through a tax-free spinoff and payment for the fractional share. How do I report this?A spinoff is a distribution to stockholders by one corporation of the stock of a controlled subsidiary. As you stated, your receipt of these shares is nontaxable. You should have received a statement from the distributing corporation stating that the spinoff does qualify as a nontaxable event for its shareholders, and this statement should be attached to your income tax return.

Members of the Maryland Association of Certified Public Accountants are answering readers' tax questions through April 15. See below for how to submit a question.I bought Marriott stock some years ago, and since then it has split and then spun off a bunch of new companies. I would like to sell the Marriott stock, but have no idea how to figure out what its basis is after all these spinoffs. What do I do?First, the basis of the original purchase cost of the Marriott stock is split in half for each share due to the 2-for-1 split.