Management Consulting
Aon
Full Credential Description
In a rapidly evolving tax environment, a multinational company faced significant challenges during a cross-border merger and acquisition (M&A) due to complex regulations and rising tax risks. The client was particularly concerned about the implications of the OECD Pillar Two and Global Minimum Taxation, which 46% of dealmakers identified as a major threat to deal success. The intricacies of tax treatment, especially regarding intellectual property and cross-border structures, posed a risk that could derail the value of the transaction. To address these niche issues, a tailored tax insurance solution was implemented. This bespoke policy was designed to protect the client against potential tax liabilities that could arise from challenges by tax authorities regarding the intended tax treatment of the transaction. The insurance covered various aspects, including taxes payable, interest, penalties, and contest costs associated with defending the tax position. This strategic risk capital allowed the client to navigate the complexities of the deal with greater confidence. As a result of this tailored solution, the client was able to proceed with the transaction without compromising on capital certainty. The tax insurance provided clarity and coverage, enabling the business to execute the deal successfully while mitigating the risks associated with unforeseen tax liabilities. This approach not only safeguarded the transaction but also facilitated innovative deal structuring options, ultimately enhancing the overall value of the M&A process.