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Double Dummy Mergers: U.S. Federal Tax Treatment

September 20, 2022

Double dummy mergers are commonly used in friendly public company acquisitions when the acquiror and target are relatively equal in size. The acquiring corporation usually acquires the target corporation using both stock and cash and, depending on the facts, the double dummy merger can be structured as (1) completely tax-free, (2) partially tax-free, or (3) a taxable purchase. Check out this tax overview of the double dummy merger structure.          

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