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During the years in issue, DeGroote was chairman of all of
the Laidlaw companies. DeGroote, Haworth, and Cairns were
directors and officers of LTL, LIL (LIIBV's parent which was
wholly owned by LTL), LIIBV, and petitioners.
5. DeGroote's Sale of LTL Stock
DeGroote owned about 50.5 percent of the voting stock of LTL
during LTL's 1986 and 1987 tax years and until May 1988.
Ownership of LTL's other voting stock was widely dispersed. In
May 1988, CP, a Canadian transportation conglomerate, bought 47.2
percent of the voting stock of LTL from DeGroote for C$499
million.
C. Growth of Petitioners and Their Subsidiaries
DeGroote and his management team established LTL as the
controlling parent of several subsidiaries which included LIIBV,
LTI, LII, and their subsidiaries. See pars. I-B-2, 3, and 4,
above.
1. LTI and Its Subsidiaries
In 1977, LTL formed LTI (a petitioner in these cases) to be
a holding company for LTL's U.S. subsidiaries. LTI, a Delaware
corporation, is an accrual basis taxpayer. LTL owned all of the
stock of LTI during the years in issue. LTI was the parent of an
affiliated group that filed consolidated returns during the years
in issue.
During the years in issue, DeGroote, Haworth, Ronald S.
Murray (Murray), and Douglas R. Gowland (Gowland) were the
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