08-05-2023, 06:00 AM
I am not 100% sure on the mechanics here either, but here is how I remember it. JNJ has already received the cash from selling a small part of KVUE. You know, the part that has been trading on the open markets for some time now. What will happen now is they will give up the rest that they have, and obviously you can't sell such a large amount on the open market.
If you participate in the switch, you'll lose your JNJ and gain KVUE with the 7% discount. The 7% discount is there to encourage traders, especially the big ones, to participate in this so JNJ can actually unload all of their KVUE. What I think will happen is JNJ will just cancel all of the JNJ shares they will receive in this exchange, lowering the share count which should more or less make up for the lost earnings on a per share basis.
edit: Personally I will not be making the switch.
If you participate in the switch, you'll lose your JNJ and gain KVUE with the 7% discount. The 7% discount is there to encourage traders, especially the big ones, to participate in this so JNJ can actually unload all of their KVUE. What I think will happen is JNJ will just cancel all of the JNJ shares they will receive in this exchange, lowering the share count which should more or less make up for the lost earnings on a per share basis.
edit: Personally I will not be making the switch.