Investors Cheer, U.S. Jeers at Tax-Driven Deals: Real M&A
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Uncle Sam may not be a fan of cross-border takeovers that allow U.S. acquirers to avoid high corporate tax rates. Investors, however, are cheering.
Since 2010, stocks of American companies that announced or completed purchases of an overseas target to shift their incorporation abroad and avoid onerous U.S. levies typically outpaced the MSCI World Index, according to data compiled by Bloomberg. They beat the gauge by 15 percentage points, based on the median performance of 14 U.S. acquirers.