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The case documents a large tax-motivated acquisition. In 1985, Chevron negotiated the sale of one of its subsidiaries, Gulf Canada Corporation (Gulf) to Olympia and York Developments Limited, a Canadian company controlled by the Reichmann family of Toronto. The Reichmanns subsequently orchestrated a complex reorganization of Gulf that yielded significant tax benefits. Principal issues for discussion are: (1) taxation is used as an instrument of public policy; (2) an important motive for corporate reorganizations is the opportunity to step-up the tax basis of certain assets; (3) uncertainty over the tax treatment of a transaction may prevent the transaction; and (4) taxes, regulation, and the legal form of a transaction are critical to the success of a large merger or acquisition.