Grant Corporation Transfers Highly Appreciated Stock to Subsidiary Corporation in Exchange

Grant Corporation transfers highly appreciated stock to Subsidiary Corporation in exchange for all of its stock. The Subsidiary Corporation stock is distributed to its sole shareholder, Peter. Three weeks after the distribution of the Subsidiary stock, Subsidiary Corporation liquidates. Peter then sells the appreciated stock that he received in the liquidation. This series of transactions

A) does not meet the statutory definition of a divisive Type D reorganization.
B) results in a capital gain to Peter.
C) fails the business purpose requirement.
D) None of the above is correct.