Cosmo Plans Management Move in Search of Irish Corporate CharmPatrick Winters and Jan-Henrik Förster
Cosmo Pharmaceuticals SpA, the Italian drugmaker that ended a pact to merge with Salix Pharmaceuticals Ltd. of the U.S., plans to move its management to Ireland to benefit from the country’s business environment.
Cosmo, which is listed in Switzerland, said it will hold an extraordinary shareholders meeting on Nov. 14 about the move. It plans to build a new manufacturing plant and tap professional skills in Ireland. The Lainate, Italy-based company also plans to move its registered office to Luxembourg because of that country’s corporate law advantages, its said in a statement today.
“This is a significant step which we had been studying carefully over time,” Cosmo Chief Executive Officer Alessandro Della Cha said in the statement. “It will give us the flexibility of top multinational groups and allow expansion of business in a country that supports pharma industry.”
Cosmo follows Pentair Plc and Weatherford International Plc in seeking corporate advantages in Ireland. Auditing and consulting firm KPMG said in an April report that Ireland is the biggest competitor for Switzerland in Europe when it comes to corporate taxation.
Under Cosmo’s abandoned merger pact with Salix, the U.S. company would have moved to Ireland and lowered its tax bill in a so-called inversion deal. A changed political environment created uncertainty about potential benefits of the plans, Salix said.
The Italian company, with a market value of about $2.2 billion, said operations in existing plants in Lainate won’t be affected and that its shares will continue to trade on the Zurich exchange.