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All deals lead to the US
The question on everybody's lips following US tax reform in 2017 was just how much this would further buoy global deal making.
In both the US and Europe, interest rates already sit at historic lows, dry-powder remains at a record high, and positive economic fundamentals in the OECD have all aided corporate liquidity in a more than $3 trillion global deal-making market since 2015, according to data by Morningstar.
What's more, 'mega-deals' (those greater than $10 billion), have only been getting larger, with 2018's Monsanto/Bayer, Linde/Praxair and Time Warner/AT&T tie-ups all propelling the transatlantic M&A market's lead over Asia.
With geopolitical risk factors including Brexit, the rise of nationalist governments, and the US-China trade war all potentially hampering investor confidence globally, with the latter already slashing Chinese outbound investment by 23% in 2018, the US, of all markets, still remains the deal-market of choice, with $1.4 trillion of deals in 2018 tied to the US.
Only Europe came close, scratching the $1 trillion mark.
While all these economic vitals invariably point to an M&A market already favouring the US, it would seem the 2017 Tax Cuts and Jobs Act only makes the US a more enviable market for deal making.
In this guide, International Tax Review presents the insights of a number of tax advisors on how changes in tax laws and regulations will impact buyer/seller sentiment, deal-structuring, financing and investment/divestment, among others, in 2019.
While US tax reform and its changes to cash repatriation laws figures commonly, these are also to be observed in tandem to the many global developments spearheaded by the OECD.
We hope you enjoy this guide.
Dan Barabas
Commercial editor
International Tax Review