By Denis Bright
The existence of Cubic Transport Systems should arouse the curiosity of investigative journalists. Regular users of the fare gates at many major cities in Australia and the USA might be excused for thinking that such operations are fully controlled exclusively by local transport authorities. Cubic’s technological skills also extend to traffic management of major motorways.
The technological excellence of the Cubic Corporation co-exists with strategies to overlook taxation payments to the Australian government. The Cubic Corporation is on The Guardian’s list of major companies which have paid no company tax since 2013.
Failure to pay taxes on Australian operations interacts with boasts about the vitality and diversity of Cubic’s investment links which have recently been acquired by Veritas Capital and its associates.
SAN DIEGO, May 25, 2021 – Cubic Corporation (NYSE: CUB) (“Cubic” or the “Company”) today announced the completion of its sale to Veritas Capital (“Veritas”) and Evergreen Coast Capital Corporation (“Evergreen”), an affiliate of Elliott Investment Management L.P. (“Elliott”), in a transaction valued at approximately $3.0 billion, including the assumption of debt.
The go-private transaction, which was announced on February 8, 2021 and the terms of which were amended on March 31, 2021, received approval from Cubic shareholders on April 27, 2021. As a result of the completion of the transaction, Cubic shareholders will receive $75.00 per share in cash, and Cubic’s common stock will be suspended from trading on the New York Stock Exchange (“NYSE”) prior to the opening of business on May 25, 2021 and will be removed from listing on the NYSE.
Cubic will remain based in San Diego, California, and the transition is expected to be seamless for customers and employees across Cubic’s businesses.
More recently, Veritas Capital has secured financing for a take-over of the NCR Corporation which manufactures those surveillance devices on trial in Australian retail outlets (Seeking Alpha, 25 August 2022):
NRC Corp (NYSE:NCR) rose 5.6% on a report that private equity firm Veritas Capital is said to have secured financing for a takeover of the company.
Several large banks are said to have committed financing for an acquisition, according to a StreetInsider report. While financing appears to be mainly locked down, a deal is still not certain and the parties NCR could decide to walk away.
The latest update in the NCR saga comes after WSJ last month said Veritas was in exclusive talks to purchase the company. At the time, the paper said a transaction may still be weeks away, and it’s not guaranteed at all. NCR has a market cap of almost $4 billion.
The WSJ report followed after Dealreporter said in late June that NCR, which is in the process of exploring alternative, may be acquired by Veritas.
NCR, a technology provider for retail stores, restaurants and banks, initiated a strategic review in February and now the board has narrowed down the potential paths the company may take, Michael Nelson, treasurer and investor relations at NCR, said at an RBC investor conference in June.
Companies like Cubic with multi-billion turnovers are of course advised by the shrewdest accountants and legal advisers. The processes used in tax minimization in partnerships with all levels of government in Australia invite speculation about the processes being applied. The media releases from Cubic are centralized out of San Diego. The use of cloud-based storage and distribution systems may enable these transport management systems to be steered from outside Australia in the interests of tax minimization. In the absence of details from the media departments at Cubic, such conclusions are merely speculative guesses.
This speculation would easily be silenced if Cubic could be more open about its former tax minimization strategies. Cubic’s media department in Sydney claims that tax minimization is old news, which his company does not wish to rehash. The media office of Cubic in Sydney claims that documentation exists to explain Cubic’s strategies for tax minimization. Despite applications to Cubic offices in Brisbane, Sydney and San Diego this documentation is being kept under wraps with a claim that this explanation is no longer relevant to Australian readers.
Adding to this intrigue is Cubic’s involvement in military training systems across the US Global Alliance. Some details of Cubic’s outreaches in defence and strategic technologies are available here. This public relations hype goes not extend to the publication of details of taxation commitments.
Cubic is involved in sales of high technology defence programmes to countries like Saudi Arabia, Egypt and Israel which would be expected to fall into line with the US Global Alliance in the event of future international conflicts. The human rights record of these participating countries seems to be no barrier to Cubic’s support for the global arms race in these outposts of global militarism.
Cubic Defence Australia is crucial to the integration of operational defence systems throughout the US Global Alliance. This was covered by a media release on 15 December 2021:
Townsville, Australia – December 15, 2021 – Cubic Defence Australia announced today that it has been awarded up to 14-year contract to support the Australian Army’s Combat Training Centre Live Instrumentation Simulation, Range Instrumentation, and Information System (CTC-LIS).
The Combat Training Centre enables the Australian military’s largest, most advanced, and potent teams to enhance their competitive advantage by empowering them to reach their potential; and the CTC-LIS provides the technology basis to achieve this mission.
The system is based at Lavarack Barracks in Townsville and deploys regularly around the country to training events, including in some of the most remote training areas in Australia.
Cubic is less forthcoming about its taxation payments to support the Australian government in these difficult times. Cubic also operates a vast network of subsidiary companies for both transport, strategic communications and defence industries which seem to be beyond the reach of the Australian Tax Office.
Australians should ask why this profitable company has paid no company tax here since at least 2013.
In the first months of the new government in Canberra, the age of legalized tax avoidance must cease. New ground rules are absolutely necessary to ensure that old practices are not continued in the 2022-23 financial year at a time when welfare agencies are issuing tents and temporary shelters to keep families off the streets and out of parked cars on these late winter nights.
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Well researched and well written, Denis. I highly rate this article.
Corporate intrigue should perhaps be a new soap opera for the 2020s . Worthwhile coverage of a topical issue Denis .
Great investigative article. Does democracy have any place in the global antics of multinational giants?
Where the fuck has our compassion gone? That people, in Australia, are living in tents, in cars, on the street, is disgusting, is shameful, though we are good at doing that, aren’t we. Refugees? What refugees? On my early morning walks through the woods, a man, 30’s, suspends his hammock in one of the picnic shelters, prior to that, a man with mental health issues lived in the woods, prior to that, a woman. All lost, forgotten, abandoned. Many I have seen here seeking sanctuary, seeking solace in the woods, every time hurts a little more. We are better than this, for fuck sake, aren’t we?
Thanks Denis
Tax evasion does not build better transport networks for complex sprawling cities like Sydney and Brisbane.
Denis, thanks for a well researched article.
What a web of corporate intrigue!
Does Cubic actually believe in democratic processes as it exports American values to a troubled world. Are these American values really corporate values that take society back in time???
Thanks for another insightful article Denis.
From the Irish Independent 15 November 2020:
The Cubic Transportation Systems (CTS) business division and its partner Sqills would deliver ticketing system upgrades for the national railway network.
Cubic Corporation, a New York Stock Exchange-listed group which has provided training systems to the US military, has announced it has won an $11m (€9.3m) contract to enhance Iarnród Éireann’s ticketing system.
In the announcement, Cubic said its Cubic Transportation Systems (CTS) business division and its partner Sqills, a ticketing software provider, would deliver ticketing system upgrades for the national railway network.
My Comment:
Is the US Global Alliance involved in hollowing out the state in independent neutral countries through these private-public partnerships with the advantages offered by tax minimization in these host countries?
The US Rail system is in a quite appalling state in most regions with large sections of the Los Angeles-San Diego Line operating on a single track system the last time I travelled with Amtrak.
Compare this with the quadruplication of the Sydney-Broadmeadow rail services in NSW under previous state Labor Governments.
Australia should be exported its rail technology to the USA by ensuring that all operations are run completely in the public sector.
Yes, time for Sinn Fein to form government in Ireland to end these threats to Irish neutrality in a newly divided Ireland in the post-BREXIT era. San Diego is not the capittal of either a divided or united Ireland.
SAN DIEGO – April 29, 2022 – Cubic Corporation today announced its Cubic Transportation Systems (CTS) business division will execute a contract by Ireland’s National Transport Authority (NTA) to be the operations service provider for the transport authority’s TFI Leap Card system. Cubic will operate, maintain, and enhance the current Leap system to align with the NTA’s future transportation goals.
Denis, great question “Is the US Global Alliance .. hollowing out the state” through PPPs? That seems to be one the main purpose of PPPs – take advantage of the public by white-anting the business over time then invite your preferred new owner to buy into the loss-making PPP at a heavy discount. The Public part of the financing takes the hit in the sale. Rinse, repeat with next PPP. I suspect it’s more-so the military/surveillance side of Cubic expertise being invited to Aus. Does Morrison know more?
Greg
Your comments are most welcome. I agree completely with your interpretation. Try to share my article with your friends.Afew thousand reads would be welcome.
Labor luminaries often welcome these PPP intrusions. They have been a disaster in NSW. Your concerns are justified. I like your comment: ” I suspect it’s more-so the military/surveillance side of Cubic expertise being invited to Aus. Does Morrison know more?”
Insiders know much more about this situation. While studying at UQ, I noticed that Labor’s parliamentary security committee had been on a junket to Pine Gap during the Rudd-Gillard years. I saw the Chair of the Labor Committee in Brisbane and aksed what the committee had been served for lunch. Did they all smoke some weed to get more excited about the facilities?, I added.
There was nothing else to discuss as only the attendees at this junket were listed. The minutes were blank on the parliamentary committee’s report.
Journalists should be chipping away at such blank spaces in our political history which were reinforced by the formation of AUSMIN after NZ was formally excluded from the alliance under David Lange’s heroic government.
https://www.dfat.gov.au/geo/united-states-of-america/ausmin/ausmin-australia-united-states-ministerial-consultations (The AUSMIN site)
The NATO site also reveals more about our relationship with NATO. Australia is an associate member. This is an excellent site: https://www.nato.int/. This may reflect the impact of the few remaining centre-left governments in Europe like Portugal who need to be kept within the Alliance as the Portuguese government depends on a range of Left parties for its continued tenure.
Let’s keep working on the problem. I have another article in draft from for next week to discuss what happened to the Forestry Plantations of Q and Victoria after their privatization.
Look forward to your article Denis. In upside down world, unpaid amateurs can use the internet to quickly see through the games being played by govt. Bribed by govt, MSM does the opposite by supporting the govt narrative of the day and distracting their audience with irrelevant analysis. That is why it pays dividends to avoid msm.
Writing these articles is not easy, Greg. There is no script to copy. Noone helps me and my research, It is always internet based and linked to topics covered at University of Queensland.
I was able to take a break in Italy travelling into Bologna and out of Lisbon in Portugal with a stopover in not so democratic Dubai in both directions. I was able to use Airbanb in most places across Europe and usually travelled by rail pass on our phone.
In Umbria, I have always passed by the town of Castiglione del Lago by Lake Trasimeno. It is some distance from the nearest station. This time I walked to the town on the hill above the lake. Sometimes, Italian drivers stop to pick up tourists who are walking but not this time (https://www.summerinitaly.com/guide/castiglione-del-lago).
There is a simple list of names in the Church of Maddalana to the soldiers from the hill town by the lake who gave their lives in Italy’s foolish war with Austria (1915-18). Italy had been invited to join in the fighting through the secret Treaty of London with the consent of the Italian Ambassador Marquis Imperiali who tragicically had a reputation for being a liberal progressive. He was later snubbed during the fascist years.
It always pays to read the full details of military commitments which affect our future soversignty. There are a lot of latter day Marqui around again wanting to use war as an instrument of foreigbn policy to the cheers of the Murdoch media and similar networks.
Thanks for your comments. See if you can spread their influence for the sake of those soldiers who died from that hill town above Lake Trasimeno.
Thank you Denis.
What an interesting read.
“…this documentation is being kept under wraps with a claim that this explanation is no longer relevant to Australian readers.”
Swing and a miss.
In this day and age, and in our current (post covid, hah) financial climate, exactly how relevant is tax evasion to anyone?
2013, What happened then? Oh. I remember.
Bastards.
Come on Labor . Fix it.
You so want to weep at the mindset…children executing insects.
Dennis, it would not be so sad if it was the exception rather than the rule with these people.
Where are the latter day Judith Wrigh’s to cheer us on? How different it might have been if she had accepted the job as Gough’s Governor-General..
My Comment
I am sure that Paul Keating would do things differ
ently if he could be recycled as a younger leader. for the mid-2020s. In the rush to avoid three severe recessions after 1980, political leaders took Australians in directions which compromised our national values.
Australians in the street have a very different perspective which is often noted by Paul Keating.
They are very hurst by the intensity of political elitism which reduces politics to the latest image building on the next eyewitness news bulletin.
Paul Keating’s Quote (FT London)
“In the 20th century, the self became privatised, while the public realm, the realm of the public good, was broadly neglected. Queen Elizabeth understood this and instinctively attached herself to the public good against what she recognised as a tidal wave of private interest and private reward. And she did this for a lifetime. Never deviating,” Paul Keating said.
I’ve just been thinking about the blitz; thinking about her beefeater hats and recalled she went through WW2 and saw the battlers have to struggle through that one.
Idont think she was the worst of them, but the system in a shocker.
I found this article very interesting. First of all, I liked the way it starts about the investigative journalists… They simply do not exist anymore. Their bosses and media’s they work for are already “bought out” by the politicians. Maybe some tax invasion in the media as well…?? And this is how corruption works allover the world now days. And we the random people, live and breath to simply vote!
As per Denis’s point, there will be another one next weekend on the investment activities of Manulife with its offices in Toronto and Boston: It is also a tax dodger.