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No extra functionalization step is required for palladium(II)-catalyzed oxidative carbocyclizations like that shown, which provide highly substituted benzofuran and dihydrobenzofuran derivatives by net dehydrogenation. The mechanism is similar to that of Heck cyclizations. Products containing quaternary carbon stereocenters can be obtained in diastereomerically pure form.
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Zhang et al. (2004) studied this question.
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