2014 IW US 500: 10 US Companies that Don't Want to Be US Companies Anymore [SLIDESHOW]

July 18, 2014
U.S. manufacturers are trying to gain relief from the corporate tax rate, even if that means giving up their identity as an American company.

As we announce the largest U.S. manufacturing companies (by revenue) in the 2014 IW US 500 rankings, it’s instructive to point out that there’s an entire group of companies that, for all intents and purposes, seem bound and determined to no longer be eligible for inclusion in that list. These are the companies that have chosen to go offshore—not for production or sourcing purposes, but strictly financial—to reestablish themselves as foreign companies.

This practice, known as tax inversion, basically involves a U.S.-based company acquiring and then merging with another company based in another country, where the corporate tax rate is significantly lower than the U.S. rate of 35% (by most measures the highest corporate tax rate in the world). Ireland in particular has emerged as a preferred country to do tax inversion deals with, as the country has a corporate tax rate of only 12.5%, nearly one-third the rate U.S. companies are taxed at.

These tax inversion deals have proliferated in the past few years, especially in the pharmaceutical sector which, as pointed out by the Wall Street Journal, is trying to “reshape itself amid rising pressure on healthcare spending and a number of patent expirations that threaten revenue growth.” But manufacturers of other sectors are certainly just as interested in gaining any kind of tax advantage they can, even if that means giving up their identity as a U.S. company (in some cases, though, the companies’ shift offshore is more of a symbolic move as they end up keeping most of their executives and employees in the U.S.).

In the gallery that follows, we take a look at several of the more prominent tax inversion deals in recent years, as well as a couple deals that failed to go through but which signal the intent of the potential acquirer to become a foreign company.

Sponsored Recommendations

2023 IW Web Survey Contest Rules

June 30, 2022
Online Contest Rules 1. Introduction: IndustryWeek ("Sponsor") is offering the Online Contest ("Contest"). NO PURCHASE NECESSARY. A PURCHASE DOES NOT IMPROVE YOUR CHANCE OF WINNING...

Accelerate mechanical design with automotive simulation software

March 10, 2023
In this free 30-day trial, learn how to accelerate mechanical design with automotive simulation software from Siemens.

A Quick Solumina MES Product Demo

Sept. 15, 2023
View this quick demo of iBase-t’s Solumina MES solution designed specifically for complex discrete manufacturers to help improve operational agility, standardize production processes...

Are you still fighting digital transformation?

April 19, 2023
Resistance to corporate digital transformation is still a reality even though the concept of simulation and digital technology has existed for decades, just not as a primary means...

Voice your opinion!

To join the conversation, and become an exclusive member of IndustryWeek, create an account today!