OUR DEALS - TAX
A private equity fund were buying a portfolio of student accommodation located in various cities across the UK. Both the vendor due diligence and buy side tax analysis flagged a concern over residence risk with a quantum in excess of £50m.
A Luxembourg-based private equity fund holding UK industrial properties received an unsolicited offer to buy the shares in the property-holding companies. The commercial terms of sale were acceptable to the seller as they had reached their targeted IRR in advance of their anticipated exit.
A founder of a specialist manufacturing business wanted to sell the business as he was approaching retirement age. His tax advisors were advising him on substantial shareholding exemption for the company and also on his own entrepreneurs’ relief exemption in relation to his shareholding.
Two parties to the sale of a high-value real estate asset considered that the transfer should be the transfer of a going concern. The buyer was not prepared to risk 20% of the sales proceeds being subject to VAT if HMRC queried the tax treatment in the future.
A private equity fund was transferring a portfolio company it owned to a new fund with new investors as the business was performing well and the fund wished to retain the business. The business is in a sector where there has been significant VAT litigation and was always monitoring its VAT position.
A distressed asset was being sold by a liquidator to a large corporate buyer. The diligence team could not trace an original option to tax for VAT purposes such that there was doubt as to whether or not the liquidator should charge VAT to the buyer.
A leasing group in the Netherlands and Belgium was being sold. The buyer queried historic royalty payments and whether they should have been exempt from withholding tax under the Netherlands- Belgian double tax treaty.
A media group was being sold and undertook a pre-sale re-organisation to hive off parts of the company which the US buyer did not wish to buy. The seller’s tax advisors prepared a steps paper and accompanying tax advice which raised a tax risk.
A private equity owned retail business was being sold to a listed buyer who required that a restructuring took place before they acquired the business: such restructuring required certain amendments to be made to the articles of the company. The management team benefited from equity in the company subject to conventional restrictions and hurdles.
A large Luxembourg based private equity house was intending to pay a number of significant cross-border pre-sale dividends from several local investment companies to their parent company. The PE house considered that the payment of the dividends should be exempt from withholding under the EU Parent Subsidiary Directive.
An investor in the renewables sector was purchasing a large solar site in the UK. As part of its financial model it had include the future availability of capital allowances.