Fertilizer manufacturers CF Industries and OCI have scrapped a planned $8 billion merger amid new U.S. tax rules that would have made it difficult to create value for shareholders. Via the Wall Street Journal, the deal fell apart as a result of the U.S. Treasury’s recent clampdown on inversions, in which companies use small mergers to move their headquarters to foreign countries with more favorable tax regimes.
CF and OCI had planned to register the combined company in the U.K. and move tax residency to the Netherlands. A proposed deal between pharmaceutical companies Pfizer and Allergan broke down last month under similar circumstances.
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