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taxpayer’s receipt of a substantial amount of cash for its
property is the hallmark of a sale. See id. at 187.
In J.E. Seagram Corp. v. Commissioner, 104 T.C. 75, 94
(1995), the taxpayer, arguing against reorganization treatment in
an effort to establish a recognizable loss, relied on the
rationale of Esmark, Inc., and this Court responded:
Esmark Inc. involved a series of related
transactions culminating in a tender offer and
redemption of a part of the taxpayer’s stock in
exchange for certain property. The Commissioner,
seeking to apply the step transaction doctrine, sought
to recharacterize the tender offer/redemption as a sale
of assets followed by a self-tender. While it is true
that we held that each of the preliminary steps leading
to the tender offer/redemption had an independent
function, we also held that the form of the overall
transaction coincided with its substance, and was to be
respected. In the case before us, petitioner would
have us respect the independent significance of
DuPont’s tender offer, but disregard the overall
transaction, which included the merger. That result
would, of course, be inconsistent as an analogy with
the result in Esmark, Inc. We therefore decline
petitioner’s request that we apply Esmark, Inc. to the
facts of this case. [Id. at 94.]
We believe that the J.E. Seagram Corp. analysis is helpful in
this case. In J.E. Seagram Corp. and in Esmark, Inc., we
declined to give conclusive effect to a single part of a complex
integrated transaction, as petitioner would have us do here.
Petitioner relies primarily on two aspects of the
documentation to conclude that the Bender transaction qualifies
as a tax-free reorganization. The first is the form by which MB
Parent common stock flowed to TMD and by which Bender preferred
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