By TONI ELLINGTON
As a follow up to previous blogs on the trend for U.S. corporations to engage “inversions” by conducting mergers and/or acquisitions with overseas companies and moving their corporate headquarters outside the United States, this week Burger King Worldwide announced it was in negotiations with Canadian chain Tim Hortons. The deal has since been completed, resulting in Burger King, the second-largest burger chain in the United States valued at approximately $10 billion, moving its corporate headquarters to Canada. Burger King has denied that the reason for the merger is based on tax savings, even though it is evident that corporate taxes are significantly lower in Canada. Burger King investors applauded the move, as the stock prices for the company rose after the announcement of the deal.
The practice of reincorporation has increased since 2003. The U.S. Treasury Department is looking for ways to close loopholes in the law to help curb the trend.
For more information, or for assistance with corporate transactions or litigation, contact Toni Ellington at 504-599-8500.