Low tax a nice cherry on top -- US firm
Accessory-maker insists proximity to Europe is main reason behind Shannon venture
Published 28/03/2011 | 05:00
IRELAND'S 12.5pc corporate tax rate is "a nice cherry on top" for the US multinational behind a 300-job boost for Shannon, but not the primary reason the company is setting up here.
Last week, it emerged that Salt Lake City-based ZAGG is to establish a European services centre that will lead to the creation of 300 jobs by the end of 2014 in the Shannon Free Zone.
The mobile communications accessory manufacturer and distributor is to invest €50m in its new Shannon operation.
But ZAGG's chief financial officer, Brandon O'Brien, said Ireland's 12.5pc corporate tax rate was not the primary reason for coming to Shannon.
"The real reason we have opened that facility is to be better able to serve the European markets," Mr O'Brien told US analysts and investors in a conference call.
Last year, the company almost doubled its revenues to $76m (€54m), due in part to its protective covers for Apple's iPad.
The company's president and chief executive, Robert Pedersen, did, however, cite Ireland's low corporate tax rate as a reason for setting up the Shannon operation.
In the same conference call, Mr Pedersen said: "Another long-term benefit from our presence in Ireland is the low corporate tax rate enjoyed by US companies with operations in Ireland.
"This should have a real positive impact on our blended corporate tax rate into the future."
"It is a nice cherry on top," Mr O'Brien added.
ZAGG has not formally announced details of the Irish move but a press conference has been scheduled for April 15.
However, Mr Pedersen confirmed that ZAGG is to establish the distribution centre, which will serve and support its European retail partners.
The US company has already lodged documents with the Irish Companies Registration Office, registering a new company with a Shannon address -- ZAGG International Distribution Ltd -- with a share capital of €50m.