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Informa Considers Swiss Tax Move
Datamonitor-owner Informa plans to form a new parent company for the group, which will be UK listed, incorporated in Jersey, and tax resident in Switzerland.
In a statement, the firm said that proposed changes to UK tax law that take effect from 1 July 2009 are likely to have a 'detrimental impact' on its tax position. Its Board believes that the implementation of a 'redomicilation scheme' will provide a platform to mitigate the probable impact of such changes to UK tax law.
When weighing up the move, Informa says it took into consideration the commercial, operational and tax benefits of Switzerland, weighed these against the possible future Swiss withholding tax liabilities and concluded that the move was in the best interest of shareholders.
The new Informa would be subject to the Swiss tax system, including any obligations to deduct Swiss withholding taxes from dividends and other distributions.
Under current tax treaties, the maximum rate of Swiss withholding tax of 35% can be reduced to 15% for qualifying UK and US shareholders.
Additionally, the move is expected to result in a structure through which the new Informa Group can develop and expand its business internationally, including in emerging markets such as the Indian sub-continent, China and the Middle East.
The group has also announced a fully underwritten rights issue to raise around £242m. The rights issue and the redomicilation are independent transactions, not inter-conditional.
Informa has offices in more than 40 countries and more than 9,000 employees worldwide. For quarter one 2009, the group generated income of £344m compared with £281m in 2008. For the year 2008, market intelligence firm Datamonitor made a positive contribution to Informa's organic growth of 1.1% to £1.3m.
Web sites: www.informa.com and www.datamonitor.com .
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