How to handle merger between Poseidon Nickel (POS.ASX) and Horizon Minerals (HRZ.ASX)
Summary
On October 24, 2024, both Horizon Minerals Limited (HRZ.ASX) and Poseidon Nickel Limited (POS.ASX) announced a proposed merger between the two. This merger was approved on 10 February 2025 where Horizon Minerals will acquire 100% of the fully paid ordinary shares and options in Poseidon Nickel.
Key dates
- Record Date: 12 February 2025
- Implementation Date: 19 February 2025
Merger details
- Share Scheme: 0.1156 New HRZ Shares for every 1 POS Share held on the Record Date.
- Option Scheme: 0.1156 New HRZ Options for every 1 POS Option (under the code “POSAAB”) held on the Record Date.
Tax implications
Capital gain
Working out your net capital gain or net capital loss for the 2025 year
For Australian income tax purposes the disposal of Securities under the Schemes will result in a capital gains tax event. At the time the POS Securityholder disposes of their security under the Scheme the CGT event will occur. However, CGT roll-over relief may be available to POS Securityholders, which results in capital gain from the CGT event being disregarded.
You can calculate your estimated tax liability using our CGT calculator. If you have more than one trade, you can add them in Sharesight and run the CGT Report to calculate your tax liability.
To work out your net capital gain or net capital loss for the year, you must take it into account:
- any other capital gains or capital losses you make in the 2025 income year from other transactions
- any net capital losses carried forwards from earlier income years
- whether you can apply the CGT discount to any part of your net capital gain.
How to handle this in Sharesight
If you opt for CGT roll-over relief
POS ordinary shares
1 – On the overview page, select POS.ASX
2 - Select Edit Holding tab
3 - Select Merge this holding
4 - Date of Merger: 19 February 2025
5 - New holding: HRZ.ASX
6 - Quantity: 0.1156 New HRZ Shares for every 1 POS Share held
7 - Select Save trade
POS options
1 – On the overview page, select POSAAB.ASX
2 - Select Edit Holding tab
3 - Select Merge this holding
4 - Date of Merger: 19 February 2025
5 - New holding: HRZ options
6 - Quantity: 0.1156 New HRZ Options for every 1 POS Option
7 - Select Save trade
FAQ
Do I need to take any action?
You do not need to take any action. Your broker should automatically handle the merger.
What do I receive for my shares?
You will receive shares in Horizon Minerals in exchange for your shares in Poseidon Nickel.
Is this a CGT event?
This is a taxable event. However, if you elect to have CGT roll-over relief, there will be no capital gain until the disposal of HRZ shares.
What is the rational behind the merger?
Consolidation of Resources: The merger aims to consolidate Horizon’s large gold resources (1.8Moz) located near Poseidon’s Black Swan processing infrastructure in the Kalgoorlie-Coolgardie districts. Potentially reducing costs and improving efficiency.
Strategic Rationale: Both companies’ boards believe that the combination offers “significant potential future upside” and a “compelling strategic rationale.” The merger is expected to create a stronger, more valuable entity than the two companies operating separately.
Growth Options: Poseidon’s Independent Directors pursued the merger after an “extensive examination of growth options” with various potential partners and corporate scenarios. The merger was considered the most favourable path for Poseidon’s securityholders after evaluating alternatives.
How does this affect my cost base and portfolio composition?
Is it important to make sure this investment remains relevant to your investment goals following the merger. You can use the Historical Cost Report to track your cost base.
The Diversity report also shows your HRZ weighting and your portfolio exposure to precious metal and mining industry.
Should you decide to rebalance portfolio, you can use the Unrealised CGT report to work out your potential tax liability.
Where can I find the official announcement and details?
You can find more details here
The guide above is a suggestion on how to handle the corporate action in Sharesight and is not finance or tax advice. We advise you to consult your financial advisor or accountant. We also encourage you to review the official Documents for full details.
Last modified on April 29, 2025 UTC