BENEFITS OF MAKING BUSINESS IN GUAM W W W. M E R G E R S C O R P. C O M
At MergersCorp M&A International we help our clients confidentially buy and sell privately held businesses, aligning the interests of all parties for mutual success and satisfaction.
It is our goal to make the process of either buying a new business or selling your current business as smooth and efficient as possible. We know how important confidentiality is to our sellers and we treat it with the utmost importance.
W W W. M E R G E R S C O R P. C O M
BENEFITS OF MAKING BUSINESS IN GUAM
W W W. M E R G E R S C O R P. C O M
Country Overview Guam is a U.S. island territory in Micronesia, in the Western Pacific. It's distinguished by tropical beaches, Chamorro villages and ancient latte-stone pillars. Guam’s WWII significance is on view at the War in the Pacific National Historical Park, whose sites include Asan Beach, a former battlefield. The island’s Spanish colonial heritage is evident in Fort Nuestra Señora de la Soledad, atop a bluff in Umatac. Guam is the southernmost island of the Marianas Island Arc, a submerged mountain range that extends 2,500 km (1,550 mi) from Guam in south to near Japan. Guam is situated within Micronesia, a sub region of Oceania. The chain of islands stretches along the Mariana Trench.
Executive Summary Guam is one of the more prosperous Pacific Islands, with a per capita GDP in the order of US$29 000. The US armed forces own one-third of the land in Guam and provide about 60 per cent of its income. A US-Japan agreement provides for the transfer of 4000 marines from US military bases in Okinawa to Guam. The US plans to significantly expand other defence capabilities on Guam, at an estimated cost of between US$11 billion and US$15 billion (jointly funded by the Governments of US and Japan). The second most important source of income is tourism, primarily from Japan, South Korea and Taiwan.
Introduction – Doing business in Guam For both the new and seasoned investor, Guam is the “Business Smart Destination”. Guam offers many business advantages and opportunities. Guam has 2 primary pillars in its economy, which are Tourism and Military. While tourism has been the primary driver of the island’s economy, the government of Guam and leaders in the private sector have jointly made aggressive strides in creating an environment for the development of other industries,. The other pillar of our economy, the US Military, is currently making tremendous amounts of investment into Guam.
Conducting business in Guam Here are the Government of Guam's requirements you should know before starting your business, 1. Business License Requirements: Generally any person or business entities doing business on Guam are required to be licensed with the Department of Revenue and Taxation's General Licensing and Registration Branch. 2. Business Privilege Tax Requirements: Guam laws provide for the assessment and monthly collection of privilege taxes. 3. Reporting Cash Payments or Over $10,000 Requirement: Guam tax code requires that cash payments more than $10,000 received from one buyer as a result of a single transaction or two or more related transactions.be reported
Taxation in Guam The U.S. Congress created the Territorial Government of Guam as a separate taxing jurisdiction by enactment of the Organic Act of Guam in 1950. Section 31 of the Act provides that the income tax laws in force in the United States shall be the income tax laws of Guam, substituting Guam for the United States where necessary and omitting any inapplicable or incompatible provisions. The U.S. Internal Revenue Code with such changes constitutes the Guam Territorial Income Tax Law.
Trade Guam is the 204th largest export economy in the world. In 2017, Guam exported $19.2M and imported $1.11B, resulting in a negative trade balance of $1.09B. In 2017 the GDP of Guam was $5.86B and its GDP per capita was $35.7k. The top exports of Guam are Industrial Printers ($1.37M), Base Metal Watches ($1.16M), Cars ($1.1M), Scrap Copper ($1.08M) and Precious Metal Watches ($1.07M), using the 1992 revision of the HS (Harmonized System) classification. Its top imports are Computers ($389M), Refined Petroleum ($367M), Cars ($73.9M), Trunks and Cases ($57.3M) and Base Metal Watches ($14.9M).
Banking in Guam March 13, 1972 – Bank of Guam was chartered by local banker Jesus S. Leon Guerrero, with a capitalization of $1.5 million with over 900 shareholders. It earned FDIC insurance and became part of the Federal Reserve Clearing System. Bank of Guam – "The People's Bank" – headquartered in Hagatna, is a community-centric financial institution with a network of 22 branches and more than 80 ATMs throughout the Western Pacific. Bank of Guam was first conceived as a dream and aspiration.
Our M&A Process TARGET APPRAISAL
APPROACH
DUE DILIGENCE
NEGOTIATION & CLOSE
POST MERGER INTEGRATION (PMI)
Revisit indicative valuation & prepare detailed valuation based on due diligence findings; SPA negotiations with the seller; Development of final structure (share/asset deal) and final valuation; Approvals; Signing of SPA & Close.
Consider the extent of integration; Development of 100 Day PMI Plan; Consider short & long term objectives; Estimate requirements to capture synergies; Determine resource needs & optimal allocation.
Company general counsel; Lawyers; Senior management.
Company general counsel; Lawyers; Senior management/HR.
Key Areas Target & market analysis; Initial assessment of synergies & value drivers; Indicative valuation; Go or No-Go decision; Preparation of transaction documents (NDA – Nondisclosure Agreement/LOILetter of Intent); Select Transaction team; Appoint advisors; Consider funding ability.
Initial approach letter; Signing of NDA; Prepare & share initial information requests; Formulation of LOI (Letter of Intent) & possible negotiations; Initial meeting and Q&A; Circulate information on the Target to the Transaction team.
Set scope of due diligence; Set up VDR (virtual data room); Coordinating of due diligence, further meetings and Q&A sessions; Consider points relevant to the Post-Merger (PMI) phase;
Parties Involved CFO; Head of M&A; Accountants; Corporate finance advisors; Consultants.
11
© Midaxo 2018
Senior management; CEO, CFO, CTO; Strategy director; Head of M&A; Head of Business Development; Consultants.
www.midaxo.com
Looking to Buy or Sell a Business? CONTACT US NOW FOR A FREE BUSINESS VALUATION
W W W. M E R G E R S C O R P. C O M
MergersCorp.com The information contained herein is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavor to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No one should act on such information without appropriate professional advice after a thorough examination of the particular situation. Member firms of the MergersCorp network of independent firms are affiliated with MergersCorp International. MergersCorp International provides no client services. No member firm has any authority to obligate or bind MergersCorp International or any other member firm vis-à-vis third parties, nor does MergersCorp International have any such authority to obligate or bind any member firm. Copyright © 2020 MergersCorp International. All rights reserved. 13
© Midaxo 2018
www.midaxo.com