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2. The 1987 Cross-Chain Sales of the Five
Subsidiaries, ML Interfunding, and Leasing
Equipment
Petitioner makes similar factual and legal arguments with
respect to the 1987 cross-chain sales. Because the factual and
legal arguments are virtually identical for all of the 1987
cross-chain sales except the one involving Vessel Leasing, we
shall consider them together, excluding only Vessel Leasing.
Like petitioner’s evidence regarding the 1986 cross-chain
sale, petitioner’s evidence regarding the 1987 cross-chain sales
focused almost exclusively on the lack of any binding commitment
or even an agreement in principle between petitioner and
GATX/BCE, the ultimate purchaser of ML Capital Resources, on the
dates of the 1987 cross-chain sales. Seven of the eight 1987
cross-chain sales occurred on March 30, 1987 (the five
subsidiaries and ML Interfunding), and April 3, 1987 (Leasing
Equipment). On those dates, GATX/BCE had not had any meaningful
opportunity to review the 3-volume offering memorandum or to
conduct its due diligence investigation, and had not
contractually committed itself to buy ML Capital Resources’
stock. Neither the board of directors of Merrill Parent nor the
board of directors of GATX/BCE had approved the transaction.
Petitioner argued that the existence of these uncertainties
precludes any finding that the cross-chain sale was part of a
firm and fixed plan to terminate ML Capital Resources’ actual and
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