MAGAZINE
November 2022 Issue
Financier Worldwide Magazine
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COVER STORY
Innovation-driven acquisitions
Given the increasing cost of R&D, more companies are looking to acquire innovative businesses to gain access to new products and services, so the emergence of new, disruptive technology will remain an important trend to watch.
FEATURES
Token troubles: key risks in the digital assets space
In 2021, digital assets hit a number of important milestones in their march to prominence as an asset class, including reaching trillions in value, having the first major crypto company to go public with the IPO of Coinbase in the US, and NFTs exploding onto the scene.
Primed to take off: the rise of DeepTech
Given their lofty ambitions, it is unsurprising that establishing a DeepTech company requires significant time and financial investment, though the rewards can be great.
Supply chain traceability – the next revolution?
Companies are taking steps to understand their supply chains in more detail. Fundamental to this goal is digitalisation and the insights to be leveraged from new technology solutions.
Client onboarding: KYC and AML considerations
Once a potential client is on the radar, an FI needs to carry out a KYC/AML risk assessment that can effectively identify the prospect’s point of origin and the source of its funds, while, at the same time, adhering to often complex regulatory frameworks.
Sharper teeth for the PRC: China’s new Anti-Monopoly Law (AML)
It would appear that China’s antitrust penalty regime has been substantially strengthened, with greater potential for fines to be imposed on individuals as well as undertakings, if they organise or facilitate the conclusion of monopoly agreements.
ROUNDTABLE
Corporate fraud is an ever-present and growing risk for companies, with a majority believing the threat level has increased over the past year. In response, boards of directors and senior executives are taking a proactive approach to fraud risk management, including risk mapping to help inform anti-fraud compliance programmes. FW moderates a discussion between Paul Peterson at BDO, Robert Sikellis at Novartis, Sarah Foley at Patterson Companies, Inc., and Elizabeth Robertson at Skadden, Arps, Slate, Meagher & Flom LLP and Affiliates.
SPECIAL REPORT
Q&A: Evolving M&A strategies: tax considerations
In this environment, businesses need to be very thoughtful and purposeful about the tax plan around a deal. FW discusses tax considerations amid evolving M&A strategies with Gemma France, Martijn Koedijk, Bob Call and Melissa Magee Page at Deloitte.
The world’s tax system under construction
Henkel The regulatory framework for tax and transfer pricing is tightening in almost every country. Consequently, financial, time and reputational pressures will be levers to help drain additional taxable income from multinational taxpayers going forward.
Simplifying the OECD’s Pillar 2: a global tax reform
FAME Advisory DMCC While Pillar 1 ensures fairer distribution of profits by reallocating taxing rights to market jurisdictions with respect to the largest MNEs (those with revenues of more than €20bn and operating margins above 10 percent), Pillar 2 ensures that MNEs which have a consolidated turnover of over €750m pay a minimum tax in each jurisdiction in which they operate.
Possible end of the debt-equity bias in the EU: brief overview of the DEBRA proposal
Ashurst This a new attempt by the EC to eliminate the debt-equity bias and to further harmonise corporate tax bases step by step.
ESG tax in the oil industry: a Brazilian perspective
Tax compliance is an obligation. However, companies have an opportunity to go beyond mere obligation and act as responsible corporate citizens that contribute to society with a long-term view.
Handling tax disputes in Hong Kong – ‘pay first, argue later’
Gibson Dunn Though challenging a tax assessment is often an uphill battle for a taxpayer, incurring significant cost and time, it also opens up dialogue between the taxpayer and the IRD.
Onch Tax Services CTC LLC Mongolia has elaborate tax legislations and regulations that are comparable to sophisticated tax systems.
Q&A: Automating the tax function
Automation is all about removing the tedious, low-value tasks to allow skilled tax professionals to spend more time doing what they were trained for. FW discusses tax function automation with Bruce Martin, Richard Sampson, Garry Young, Russell Gammon and Andy Myers at Tax Systems.
TALKINGpoint
Shareholder activism and takeover defence
We are going to see more campaigns and proxy contests, but we are also going to see an increase in settlements for director seats. Now is the time to review board composition, as well as bylaws and other governance policies and to reassess vulnerabilities. FW discusses shareholder activism and takeover defence with Kai Liekefett, Derek Zaba, Beth Berg, Jessica Wood and Reuben Zaramian at Sidley Austin LLP.
Evolution of the automotive sector – evolving safety and liability
The requirement to appoint a product safety representative is becoming increasingly significant in the automotive supply chain. Players in the automotive industry need to think much more holistically and across the entire product lifecycle. FW discusses the evolution of safety and liability across the automotive sector with Miriam Richter, Florian Hoffmann and Benjamin von Bodungen at Bird & Bird LLP.
While sustainability should already be a key priority for retailers, it will only become more important in the coming years. Retailers that choose to forgo the journey toward a more sustainable future put their customers, their workforce, and the profit and reputation of their business at serious risk. FW discusses sustainability in the retail sector with Jason Saiban, Kerry Stares, Nick White, Ingrid Saffin and Ashwin Pillay at Charles Russell Speechlys LLP.
DEALfront
mergers & acquisitions
Vistry agrees $1.43bn Countryside deal
British house builder Vistry has agreed to acquire its rival Countryside in a deal worth $1.43bn. The newly combined company would be the third largest house builder in the country.
Novo Nordisk agrees to acquire Forma Therapeutics for $1.1bn
As part of its aim to build a portfolio of treatments to tackle the complications and underlying causes of sickle cell disease, Danish drugmaker Novo Nordisk is to acquire clinical-stage biopharmaceutical company Forma Therapeutics Holdings, Inc. in a transaction valued at $1.1bn.
private equity & venture capital
Macquarie agrees €2.4bn Suez deal
French utility company Veolia has agreed to sell Suez’s UK waste business to Australia’s Macquarie Group in a deal worth around €2.4bn. The sale is part of Veolia’s efforts to resolve antitrust concerns around its protracted €13bn acquisition of rival Suez in 2021.
CSI agrees $1.6bn deal with Centrebridge and Bridgeport
In a $1.1bn deal that will take the company private, end-to-end FinTech and RegTech solutions provider Computer Services, Inc. is to be acquired by global, multi-strategy private investment firm Centerbridge Partners, L.P. and private investment firm Bridgeport Partners.
bankruptcy & corporate restructuring
Lighting leader Lumileds files for Chapter 11
In a bid to emerge from Chapter 11 bankruptcy within approximately 60 days, Netherlands-based lighting company Lumileds Holding BV has entered into a restructuring support agreement in a bid to deleverage and strengthen its balance sheet.
Jump in US leveraged loan defaults
Concern is mounting over growth in US leveraged loan defaults. Indeed, default activity in the US leveraged loan market increased markedly in August, after bankruptcy filings from four issuers in the Morningstar LSTA US Leveraged Loan Index pushed $4.46bn of institutional loan debt into non-performing status.
SPOTlight
Why long-term hold funds are here to stay
Gilbert + Tobin There is an increasing focus by investment managers and investors on holding long-term development real estate, private equity (PE) and venture capital (VC) investments. This global evolution has important ramifications for investment fund offerings and investors.
Impact of the FCA’s new Consumer Duty on mortgage book deals in the UK
Norton Rose Fulbright LLP Both sellers and purchasers should prepare for a greater interrogation of conduct risk relating to the required areas of diligence, and broader thematic issues as part of diligence going forward, recognising that this will not just be a matter of contractual liability but also more focused regulatory risk.
Should a company’s ESG performance determine its chief executive’s pay?
The Conference Board Linking specific components of executive compensation to ESG performance metrics is increasingly a way to both highlight a company’s commitment to its sustainability goals and to focus senior executives on their role and responsibility in delivering on these ambitions.
Quinn Emanuel Urquhart & Sullivan, LLP Temperatures across the industry have begun to rise again following fresh complaints about the widespread use of so-called ‘thermal windows’. Engines using this software detect when the ambient temperature falls outside a certain range and either reduce or switch off the vehicle’s emissions controls.
Remote working – not entirely risk free
Hassans International Law Firm Remote working brings risk. It should not be something that happens without analysis of that risk. Greater awareness is required – only then can the issues be dealt with, and companies can avoid pitfalls that could lead to lengthy tax investigations and large tax bills.
CONTRIBUTORS
Ashurst
BDO
Bird & Bird LLP
Charles Russell Speechlys LLP
Deloitte
FAME Advisory DMCC
Gibson Dunn
Gilbert + Tobin
Hassans International Law Firm
Henkel
Norton Rose Fulbright LLP
Novartis
Onch Tax Services CTC LLC
Patterson Companies, Inc.
Quinn Emanuel Urquhart & Sullivan, LLP
Sidley Austin LLP
Skadden, Arps, Slate, Meagher & Flom LLP and Affiliates
Tax Systems
The Conference Board