[BC] Bidders in/out at ABC

[PeterH5322@aol.com]

In a message dated 12/9/05 8:47:20 AM, barry at oldradio.com writes:

> The industry trades are abuzz with the current "auction" for ABC Radio.
>
> http://www.fmqb.com/Article.asp?id=152880


>From piperjaffray.com, by way of definition of a "Morris Trust" ...

Morris Trust transactions typically used to work as follows: First, assume 
that the target company ("Parent") is engaged in two different businesses - one 
is a "wanted" business and the other is "unwanted" from an acquirer's 
("Acquirer") perspective. Next, Parent would "spin" the unwanted business into a Newco 
and distribute Newco's stock to Parent's shareholders. Subsequently, Acquirer 
would acquire Parent (containing only the wanted business). As a result, 
Parent's transfer of the unwanted business into Newco and Parent's distribution of 
Newco's stock to its shareholders was tax-free because the transaction 
qualified as a 'D' reorganization.

... one can conclude that ABC/Disney sees the radio unit as the "unwanted" 
business unit.

Also ...

http://www.unclefed.com/Tax-Bulls/2003/rr03-79.pdf