Wednesday, April 14, 2010
Britain’s largest private company, chemicals group INEOS, is to forge ahead with its proposals to relocate to Switzerland from the UK for tax purposes, attributing the move to the British Isles’ increasingly "uncompetitive tax regime”.
The group, which is thought to be burdened with a GBP6bn debt following an aggressive acquisition spree, buying up parts of ICI and BP, says that it could save around GBP400m by 2014 from the move.
The announcements follows approval from its lenders, which notably include state-owned Lloyds Banking Group and Royal Bank of Scotland. The restructuring will allow the Group to begin repaying a significant portion of its debt this year.
“We have to make a decision that is right for INEOS, our businesses and our sites, to ensure we remain competitive long-term in a global marketplace. Many leading chemical companies have European or global operations resident in Switzerland and we need to compete effectively with them,” Tom Crotty CEO of INEOS said, when the proposal was first announced on March 3.
Under the plans, INEOS Chairman, Jim Ratcliffe, and around 20 senior executives will operate a new holding company in Switzerland. The Group has said that irrespective of the change of its tax status, it “remains committed to its UK operations”. INEOS is one the country’s largest manufacturing companies, employing 3,700 permanent staff and 1,000 contractors across eight UK sites; supporting tens of thousands of indirect jobs.