Financial Engineering and Tax Risk: The Case of Times Mirror PEPS Case Solution & Answer

This case is about  POLICY

PUBLICATION DATE: December 20, 1996

Financial Engineering and Tax Risk: The Case of Times Mirror PEPS Case Solution

This note gives the historical background regarding taxes on the company’s securities, and demonstrates how the inconsistent taxation of functionally-similar securities can permit fiscal engineers to bear tax threat to get positive returns.

It is to be utilized with Times Mirror Review, so that students can understand and compute the tax-driven sources of value from Times Mirror’s use of a PEPS to monetize its holdings in Netscape.

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