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The following step was taken from the synthesis of Kinamycin C on SynArchive. It employs the use of a peculiar reagent, that is, bis(acetoxy)iodobenzene (BAIB), also known as phenyliodine(III) diacetate (PIDA). Being a high-valent iodine species, it is used as an oxidising agent in organic chemistry. So clearly, there is some sort of oxidation taken place in this step, along with nucleophilic aromatic substitution involving an $\ce {MeOH}$ molecule. However, I am quite uncertain as to what is the mechanism by which this step takes place.

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The conventional mechanism is as follows:

Mechanism of oxidative dearomatisation using hypervalent iodine

The phenol displaces one acetate group on iodine – this makes the iodine itself act as what is essentially a fancy leaving group. Nucleophilic attack at either the ortho or para position allows the loss of iodobenzene and another molecule of acetic acid. What I can't explain right now is why it chooses to go para rather than ortho; it probably depends on the exact substitution pattern as I have seen examples of both. A good reference for this is Zhdankin, Hypervalent Iodine Chemistry (2013).

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    $\begingroup$ Perhaps, the preference for the position of substitution is due to the stronger inductive withdrawal of the methoxy substituent already attached at that position. $\endgroup$ – Tan Yong Boon Apr 20 at 15:12

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