On 5 March 2013, the Court of Appeal released its judgment in Alesco New Zealand Limited and Ors v. Commissioner of Inland Revenue [2013] NZCA 40.
(a) Facts. This test case involved Alesco New Zealand Limited (Alesco NZ) funding its NZD 78 million acquisition of two New Zealand companies by issuing non-interest bearing, 10-year optional convertible notes (OCNs) to its Australian parent company (Alesco Australia). At maturity the OCNs could be redeemed in cash or converted into Alesco NZ …