Wednesday, September 26, 2007

Bayer Bails On the NYSE, Cites U.S. Regulations

Relieving itself of the pain of high regulation fees in the U.S., German aspirin maker Bayer left the New York Stock Exchange today. Bayer says leaving the NYSE will save more than $20 million in listing fees and accounting costs.

Bayer joins British Airways and 32 other foreign companies that have delisted from the New York Stock Exchange this year. Nine other foreign companies have announced they plan to do so as well this year. Another 20 foreign firms said this year they plan to leave the Nasdaq or have done so already.

One reason is cost. The NYSE listing fee for most foreign companies is $38,000 a year. But fees needed to comply with Sarbanes-Oxley rules and convert books to meet U.S. accounting standards can add millions of dollars in costs.

Expect the exodus to continue,
a global market expert says. "You will see more (foreign companies) delisting from U.S. markets," she says. "I'm hearing everyone in Europe discussing it."

Bottom Line: If you tax or regulate something, you get less of it.

3 Comments:

At 9/27/2007 2:17 PM, Anonymous Anonymous said...

While Sarbox may have gone too far in its regulations, I thing that the likes of Enron and Worldcom displayed the fact that there is such a thing as too little regulation as well.

 
At 9/28/2007 9:24 AM, Blogger juandos said...

"I thing[k] that the likes of Enron and Worldcom displayed the fact that there is such a thing as too little regulation as well"...

Well you might sing a different tune if the company you work for gets tired of shouldering the expense of Sarbox and pull up stakes and heads to an off-shore facility...

 
At 11/07/2007 1:50 AM, Anonymous Anonymous said...

Bayer's move sounds like typical of its continuing search for direction.

 

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