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Demerger consideration

Demerger consideration

Demerger consideration is the compensation that shareholders in a company being divided receive in a demerger.

What is demerger consideration?

Demerger consideration (Swedish: delningsvederlag) is the compensation the shareholders of the transferring company receive in a demerger. It consists mainly of shares in the receiving company or companies, but may also include cash. How the consideration is allocated is set out in the demerger plan.

 

Demerger consideration and the share ledger

Once the demerger is registered with Bolagsverket, shareholders receive their new shares. These must be entered in each company's share ledger with the correct shares and owners, so that each ownership picture is accurate, for example in a spin-off.

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Related terms

Demerger

A demerger means a limited company's assets and liabilities are transferred to one or more other companies.

Demerger plan

A demerger plan is the plan the board of directors draws up ahead of a demerger of a limited company.

Spin-off

A spin-off means that part of a company, often a subsidiary, becomes an independent company of its own.

Merger

A merger means two or more companies combine into one.