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Altria (MO) Spinoff of Kraft Foods (KFT): Why did I receive the KFT eventhough I didn't own MO at Record Date?


I have a brokerage account with Banc of America Investment Services. I purchased 40 shares of Altria on March 27th, and did not own any share at the March 16, 2007 record date. I, however, still received 27 shares of Kraft Foods when it was spun-off yesterday. I thought you had to own the shares at the record date in order to receive the newly spun-off shares of Kraft. Does anyone know why?

There are two possible reasons:

1. MO was trading "with due bills", i.e. even though you were not record date holder when you purchased it on the 27th for settlement on the 30th, the actual ex-date of the spinnoff you were actually purchasing the "due bills" of the record date holder along with your MO stock. So without knowing it you bought KFT also. Nice work!!!!

2. Bank of America Investment Services made a mistake.

Call your broker at BofA first thing on Monday before you do any trades in KFT.

Good luck.

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