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Apple May Have Plans to Acquire Netflix

02 January 2018

Under this cash cut, Apple will have the opportunity to repatriate about $220 million in cash and it needs one-third of the amount to acquire Netflix. These analysts put the probability of a Netflix purchase by Apple at 40 percent, with the the purchase being made possible thanks to President Trump's tax cuts.

Historically, Apple has avoided repatriating cash to the United States to avoid high taxation.

The thought is that Apple has long wanted a successful TV and movie offering.

According to the report, Trump's cut in corporate taxes and a one-time allowance for companies to repatriate cash stored overseas without a major tax hit gives Apple a much larger potential cash warchest to buy new companies. "With over 90% of its cash sitting overseas, a one-time 10% repatriation tax would give Apple $US220 billion for M&A or buybacks". On the other hand, Apple already has about $252 billion in cash, mostly in foreign jurisdictions.

Citi analysts Asiya Merchant and Jim Suva note that the tax cut alongside a one-time offer to repatriate the cash global but America-born companies have back into the U.S. could lead to Apple having $220 billion to spend on snapping up other companies. This list includes companies like Activision, Electronic-Arts, Take-two, Hulu, Disney and even Tesla.

Just after the note was written, Disney acquired the studio and television assets of Fox.

Apple has recently dipped a toe into content creation: Jennifer Aniston and Reese Witherspoon will be in Apple's first scripted video series.

"The firm has too much cash - almost $250 billion (roughly Rs. 15.9 lakh crores) - growing at $50 billion (roughly Rs. 3.18 lakh crores) a year". Still leaving the company strong with 2/3rds of their existing cash and with this number increasing at the rat of USA $ 50 Billion each year, Apple could be eyeing other potential investments.

Apple May Have Plans to Acquire Netflix