We offer a range of M&A tax services to corporate and private equity investors covering all phases of domestic and cross-border transactions. Our services include:
- tax due diligence
- structuring an acquisition or disposition
- tax modeling
- vendor assistance
- post-deal integration.
Companies with global ambitions cannot afford to ignore the opportunities for profitable growth offered by mergers, acquisitions and disposals. But if these transactions are to create real value, it is important that the tax implications of each deal are dealt with from the outset. This is especially important in cross-border deals, where differing regulations and business cultures need to be reconciled in order to reveal the risks and opportunities of a transaction.
Similarly, private equity seeking to increase return on investment cannot afford to ignore tax. Recent trends show that M&A transactions have become more international and deal volumes have increased tremendously. Highly-leveraged transactions allow for big ticket deals, in particular within the private equity market.
In a highly professional and competitive deal environment, many transactions are organized as structured auctions. Only the strongest bidder will win. When strategic investors compete with private equity for the few attractive targets offered, understanding how a deal is done becomes crucially significant. To assess the real value of a transaction you need to understand the historical tax risks associated with an enterprise for sale. To win an auction, you also need to evaluate and quantify upside potential. In many cases, tax can make a difference.
Running an M&A process means coordinating many different work-streams within a very strict timeline. In the auction processes, there is little flexibility surrounding bid deadlines. Deadlines are short to keep management attention to an acceptable minimum. Valuable time can be lost just trying to organize your deal team. Tax due diligence, international acquisition structuring and modeling tax in the acquisition target's business forecast should be addressed immediately.
KPMG's M&A Tax practice can help companies with these processes, avoid pitfalls and seize opportunities. Working closely with our Transaction Services group, M&A Tax provides:
- national and multi-jurisdictional tax due diligence for acquirers and vendors, identifying what the tax exposure is on a deal and how it may be mitigated ― with clear focus on risk assessment
- advice on the tax consequences of individual acquisitions, joint ventures and divestments in order to help design tax-efficient deal structures
- assistance in forecasting post-deal tax liabilities in business models
- post-transaction integration tax advice, which helps our member firms' clients reconcile their own tax positions and those of the acquired business.
We can also assist when companies are undergoing contraction through our economic downturn tax advisory services. Whether through restructuring, divestment, shut-down or liquidation, we advise on the tax impact of a contraction.
As we are a part of a global M&A Tax network, our member firms' clients have access to dedicated tax professionals who understand how tax affects transactions across the world. With a strong focus on transactions with a private equity background, they are commercially minded and deal hardened, they know how to identify and advise on the material tax exposures in a transaction and to develop deal structures that appropriately address the tax implications. Working on transactions day-by-day, they are process-driven and understand the mechanics of acquisition and disposals in a competitive environment.
Professionals from across our global network keep in regular contact with each other, with our member firms’ clients and with the tax authorities. We therefore understand the practical impact of tax developments from one country to the next. We can spot opportunities and we know how to act on them to benefit our member firms’ clients and their stakeholders.
For more information about our approach to mergers and acquisitions tax, please contact KPMG’s Mergers & Acquisitions Tax practice.