Columnists seldom give advice to the ultra riche who could crush them. Still, I’m willing to risk telling the private-jet set that starving your workforce’s countries of the taxes that fund healthcare and education is a really bad look.
It’s a view, new research says, that is shared beyond the sphere of the justifiably judgmental working class. Investors also see the ugliness of risk in companies who incorporate in tax havens.
The research was conducted by Christina Lewellen, an assistant professor of accounting in North Carolina State University’s Poole College of Management, compared data from more than 7,500 publicly traded companies incorporated in countries that are not tax havens with data from 500 companies based in the same countries, but incorporated in one of 20 tax haven countries.
“Basically, we found that investors view tax havens as having additional risks,” said Lewellen. “Because of this, the cost of equity capital of companies incorporated in tax havens is higher than other companies.
“For example, if you had two identical companies but one was incorporated in the U.S. and the other was incorporated in a tax haven, investors would likely choose to invest in the U.S. Company – unless the tax haven company could promise higher dividends and/or higher stock price growth to compensate for the additional risks.”
The bottom line, as usual, is not moral but financial. Companies incorporated in tax havens face higher costs that are 5% to 19% higher as they raise equity capital.
A new logistics deal will see Canadian vegan products go global. Vancouver’s plant-based food tech company, The Very Good Food Company Inc., has just announced a distribution partnership with Peter Green Chilled, 3PL logistics provider in the UK and Europe, to start next month.
The vegan food producer will be launching an UK e-Commerce platform in August and has selected Peter Green Chilled as its Importer of Record to help distribute the company’s plant-based products first in the UK, and later Europe. Peter Green Chilled offers 3PL logistics services including importing, customs clearance, warehousing and transportation of food products throughout the UK and the EU.
“We are excited to finally offer UK-based customers a range of The Very Good Butchers products via our UK e-Commerce launch this summer,” said Very Good’s co-founder and CEO, Mitchell Scott. “Building on our strong e-Commerce channel in North America, we are entering into new markets with direct to consumer sales to build brand awareness; opening the door for expansion into retail and food service in the UK and Europe. The partnership with Peter Greene is a logical fit given their extensive experience and local expertise serving these markets and supports our global expansion efforts.”
Some of us have been expecting the large-scale conversion of office towers into live-work lofts with real showers and decent Internet since 1996. Sure, there have been small-scale boutique conversions of old-banks and churches into condos, but we’ve really only just started to hear about large companies reducing their “real estate foot print” and going “permanently remote-first” since the pandemic.
It is clear that commercial and industrial real estate is going to change, but not necessarily in the way we thought.
GI Partners, a private investment firm, has announced the launch of the GI Real Estate Essential Tech + Science Fund. The ETS Fund will invest in real estate assets that continuously operate to support mission critical functions of the technology and life sciences industries. They are seeking to acquire data center properties, life sciences assets, and R&D facilities within the office and industrial sectors. In other words, properties that are widely-considered remote work proof.
“The global economy is being transformed by technological and science innovations impacting the way people live and work,” said John Sheputis, Managing Director of GI Partners and Head of the ETS Fund. “Data centers, life sciences assets, and always on facilities support essential functions of the 24/7 modern economy. Our goal is to maximize risk-adjusted returns for our investors by identifying untapped segments of the market where our experience provides a critical competitive advantage. We believe our initial portfolio and extensive pipeline reflect the opportunities in these important sectors.”
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