Big Tech M&A Update: IBM to Acquire Confluent💰 What Happens to RSU/ESPP held by Confluent Employees at Close

Big Tech M&A Update: IBM to Acquire Confluent

💰 What Happens to RSU/ESPP held by Confluent Employees at Close -

IBM has entered into a definitive agreement to acquire Confluent in an all-cash deal at $31 per share, subject to shareholder and regulatory approvals. Expected close: mid-2026.

💰 What Happens to RSU/ESPP held by Confluent Employees at Close –

With Examples

The acquisition price is $31 per Confluent share.

📌 𝐄𝐱𝐚𝐦𝐩𝐥𝐞 1: 𝐂𝐨𝐧𝐟𝐥𝐮𝐞𝐧𝐭 𝐕𝐞𝐬𝐭𝐞𝐝 𝐒𝐡𝐚𝐫𝐞𝐬 𝐑𝐒𝐔 / 𝐄𝐒𝐏𝐏 𝐒𝐡𝐚𝐫𝐞𝐬

👉 You hold 100 Confluent Vested (RSU) shares (or ESPP shares)

💵 Payout at close:

100 × $31 = $3,100 cash

𝐓𝐚𝐱 𝐓𝐫𝐞𝐚𝐭𝐦𝐞𝐧𝐭: Capital gain in India

If the shares are held for 2 years or more, the gains are taxed at 12.5%.

If the shares are held for less than 2 years, the gains are taxed at 30%.

(Applicable Surcharge and Cess)

📌 𝐄𝐱𝐚𝐦𝐩𝐥𝐞 2: 𝐔𝐧𝐯𝐞𝐬𝐭𝐞𝐝 𝐑𝐒𝐔𝐬

👉 You have 200 unvested Confluent RSUs

At close, these do NOT get cashed out

They are converted into IBM RSUs

Conversion is done so that economic value remains the same

💡 If 200 Confluent Unvested RSUs = $6,200 value (200 × $31)

👉 You may receive IBM RSUs worth ~$6,200, which

✔️ Continue to vest

✔️ Follow the same vesting schedule as earlier

𝐓𝐚𝐱 𝐓𝐫𝐞𝐚𝐭𝐦𝐞𝐧𝐭: Taxed in salary as per further vesting

📌 𝐄𝐱𝐚𝐦𝐩𝐥𝐞 3: 𝐈𝐧-𝐭𝐡𝐞-𝐌𝐨𝐧𝐞𝐲 𝐒𝐭𝐨𝐜𝐤 𝐎𝐩𝐭𝐢𝐨𝐧𝐬

👉 You hold 1,000 options

Exercise price: $20

Deal price: $31

📈 Intrinsic value per option:

$31 − $20 = $11

💵 Cash payout:

1,000 × $11 = $11,000 cash

(You do not need to exercise the options)

𝐓𝐚𝐱 𝐓𝐫𝐞𝐚𝐭𝐦𝐞𝐧𝐭: This cash payout is subject to withholding taxes, either as a dividend or as salary perquisites, as applicable.

📌 𝐄𝐱𝐚𝐦𝐩𝐥𝐞 4: 𝐎𝐮𝐭-𝐨𝐟-𝐭𝐡𝐞-𝐌𝐨𝐧𝐞𝐲 𝐎𝐩𝐭𝐢𝐨𝐧𝐬

👉 Exercise price: $35

👉 Deal price: $31

❌ No intrinsic value

❌ Options are cancelled

❌ No payout

𝐓𝐚𝐱 𝐓𝐫𝐞𝐚𝐭𝐦𝐞𝐧𝐭: Nothing to do with taxes in India