The promise — and perils — of inversion deals – Why everyone’s talking about these cross-border mergers

Description

Abstract: Corporate inversions have become the dominant means of making cross-border mergers. A buyer in the United States reduces its global tax exposure by finding a seller in another country with a lower corporate tax rate. Then the buyer “domiciles” itself in the seller’s country, either setting up new offices or taking over its target’s facilities. However, as this article discusses, inversion deals are controversial and new regulations may make them less appealing. A sidebar lists risks associated with inversion deals.