Economy

antigop

(12,778 posts)

60. Hedge Funds Bet Big on Overseas Tax Deals

Sun Jul 27, 2014, 12:24 PM

Jul 2014

http://online.wsj.com/articles/hedge-funds-bet-big-on-overseas-tax-deals-1406330775

Hedge funds are wagering billions of dollars on companies they believe will benefit from a wave of takeover deals designed to lower taxes for U.S. acquirers.

The boom in "inversion" deals, in which a U.S. firm buys a foreign company and moves overseas, has raised the ire of President Barack Obama, who has said the practice is "wrong." But many bankers and lawyers believe the trend could continue until at least the end of the year, potentially enabling hedge funds to make hefty profits.

Wall Street has long tried to guess which companies are likely to engage in takeovers, both acquiring companies and target firms, sometimes a lucrative game.

This time hedge funds are scouting for U.S. companies and the foreign firms they could target in a bid to reincorporate overseas to escape higher U.S. taxes.

Is this a great country or what?

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