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European subsidiaries and cash to FCI in exchange for 40 percent
of the stock of Burndy-Japan.22 Petitioners contend: (1) The
value of the stock of the subsidiaries did not exceed the value
of a 40-percent interest in Burndy-Japan; (2) the value of the
stock of the European subsidiaries that Burndy-US reported on its
1993 income tax return is not relevant to deciding whether
Burndy-US paid excess value to FCI; and (3) Burndy-US or
Framatome US distributed the stock of FC-Spain and FC-Italy to
FCI in 1994 rather than 1993, so that any associated transfer of
value occurred in 1994. We disagree in part with both parties.
According to the petition, Burndy-US reported on its 1993
return that it transferred $53,050,302 in stock and cash to FCI
in exchange for 40 percent of the Burndy-Japan stock.23
Respondent contends that, in so doing, Burndy-US reported that 40
percent of the Burndy-Japan stock was worth $53,050,302.
Petitioners state in their brief that 40 percent of the Burndy-
Japan stock was worth $51,411,007. We accept respondent’s
position that 40 percent of the Burndy-Japan stock was worth
$53,050,302 because that amount is more favorable for
petitioners.
22 Alternatively, petitioners contend that, if the transfer
of a 40-percent interest in Burndy-Japan resulted in a dividend
to FCI, the dividend was $3,046,360.
23 The return is not in the record.
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