Australian building materials group James Hardie Industries is to shift its corporate domicile, or headquarters to Ireland, in an effort to reduce its tax payments.
James Hardie, which moved its headquarters from Australia to the Netherlands in 2001 and had been mulling a further shift, said the move would cost it between $51m and $71m.
It said that moving to Ireland would provide greater certainty over its tax treatment by US authorities, simplify its governance structure to a single board of directors, and allow most shareholders to receive dividends free of withholding tax. Shareholders will vote on the move at a special meeting to be held in Amsterdam on August 21.
Hardie had examined moving the company to the US, or back to Australia, but rejected those options due to the tax implications for shareholders.
In May the company reported a 57% dive in fourth-quarter operating profit, but said it believed the housing slump was near the bottom.
Hardie said it was suspending its dividend to preserve capital as it concentrates on on cutting costs and increasing its market share to cope with the downturn.
'The proposal will not change the overall commitment of James Hardie to make contributions to the Asbestos Injuries Compensation Fund,' CEO Louis Gries said in a statement.
The company, once Australia's largest asbestos maker, agreed to set up the fund after several years of negotiations with state governments, unions and former workers, and made its first payment in 2007.
