14 June 2016 at 1:02 GMT
Microsoft Corp. has enough cash to buy LinkedIn Corp. four times over. So why is it taking out a big loan to pay for its latest purchase? Maybe because it’ll lower the technology giant’s tax bill. For one thing, Microsoft will avoid having to pay a 35% tax rate to repatriate cash from overseas accounts. While it’s true that Microsoft has more than $100bn in cash and cash equivalents, most of it is parked offshore. Bringing home any of it to fund the proposed $26.2bn purchase, announced on Monday, would generate a tax bill.
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