Controlled Group with 2 Separate 401(k) Plans - one employer leaves controlled group - distribution event for 401K?

Company A and Company B are a part of the same controlled group.  Company A has a 401(k) Plan and Company B has a 401(k) Plan.  C is employed by Company A and participates in Company A and Company B's 401(k) Plan.  Company B leaves the controlled group, but C remains employed by Company A and has a balance in Company B's 401(k) Plan.  Can C receive a distribution from Company B's 401(k) Plan after Company B leaves the controlled group?   Is the departure of Company B from the controlled group considered a distribution event?  

Off the top of my head, I would think so. C presumably was employed by Company B at some point (giving C a balance in the Company B 401(k) plan) and terminated from employment with Company B and transferred to Company A. C had a separation from service with Company B, but not from the "Employer" that included Company B and Company A. When Company B is no longer in a controlled group with Company A, C has had a separation from service from Company B and all members of its new controlled group, which should be a distributable event. I think this would hold true even if Company B continued to sponsor its plan after closing because C is still separated from service with Company B (whereas this fact pattern would not give ongoing Company B employees a distributable event from the Company B plan).