Comment by Animats

Yes. See [1] for an overview of how this works.

When the SEC filing is made, we'll get to see how the deal is structured. The $20 billion from TD Securities becomes a debt obligation of the combined company. There's a tax break in equity to debt conversion, and a second tax break for carried interest. [2] There may be a preferred stock deal or debt refinancing so that TD gets their $20 billion back. Usually, the private equity firm exits within a few years.

[1] https://pubs.aeaweb.org/doi/pdfplus/10.1257/jep.23.1.121

[2] https://www.pgpf.org/article/what-is-the-carried-interest-lo...