General Discussion
Related: Editorials & Other Articles, Issue Forums, Alliance Forums, Region ForumsHow Hedge Funds Are Pushing Companies To Leave America
http://www.forbes.com/sites/nathanvardi/2014/05/01/how-hedge-funds-are-pushing-companies-to-leave-america/But hedge funds are moving faster than Washington. Billionaire hedge fund manager William Ackman had never made a pharmaceutical investment before April. But last month his Pershing Square hedge fund made its biggest investment ever, taking a 10% stake in California-based Allergan. Ackman is making the $4 billion bet while working with Valeant, a company based in Canada whose senior executives work in New Jersey and has its tax-domicile in Barbados. Valeant has made a $45 billion bid that is driven by tax considerations to buy Allergan with Ackman.
Valeant itself is a hedge fund-created machine. ValueAct Capital Management, the activist hedge fund run by Jeffrey Ubben, has been a major shareholder for years and ValueActs Mason Morfit sits on the companys board. Morfit even designed the highly-lucrative compensation package of Valeant CEO Michael Pearson, who has become a billionaire since he started running the company six years ago. When ValueAct got involved and Pearson started running the show, Valeant was based in California. Valeant then bought and folded the company into Canadas Biovail to take advantage of Canadas tax rules. Using Valeants lower tax structure, Pearson has done about 100 or so deals since 2008 and pushed Valeants stock up by some 800%.
Also in April, a group of high-profile hedge funds started to pressure Walgreen, Americas biggest pharmacy chain that is based in Illinois, to move to Europe for tax purposes. The Financial Times reported that activist hedge funds like Barry Rosensteins Jana Partners and Keith Meisters Corvex Management, together with billionaire Dan Ochs Och-Ziff Capital Management hedge fund and Goldman Sachs, urged Walgreens senior management in a meeting in Paris to domicile its tax base in Europe as part of its $16 billion takeover of Alliance Boots, which is based in Switzerland.
onethatcares
(16,166 posts)I got a $27.00 income tax refund this year. After spending 1% of my income on health care problems and 10% to charity.
The united states, what a great place, huh?
Brigid
(17,621 posts)When banks were locally oriented, tightly regulated, and not allowed to speculate with their depositors' money. Investment banks were small, privately owned partnerships whose members lived well but didn't want to bet the ranch on anything because they put the money up themselves. Bond traders took second jobs because they didn't earn enough to support their families. In 1972, Morgan Stanley had 110 employees, 1 office, and $12 million in assets. This is the way things were in the decades after WW II, and we didn't have a single financial crisis. Then came Raygun and deregulation, and it was off to the races. The financial industry has gotten completely out of control, and has destroyed the country.
See "Inside Job" for further details.
Starry Messenger
(32,342 posts)On DU we hear that it is corporate tax rates that are too high and those evil unions.
KittyWampus
(55,894 posts)required to be in the USA?
Answered my own question-
Obama Administration trying to write tax code so it stops, GOP not going along.
http://www.reuters.com/article/2014/04/30/us-usa-tax-treasury-crackdown-exclusive-idUSBREA3T0ZZ20140430