A fast-growing Californian company that makes MP3 players and invented "flash" high-density memory cards for digital cameras aims to route more than $1 billion (€805.86 million) in annual revenues through its newly-expanded Irish unit before the end of next year.
SanDisk, whose memory cards are also used in mobile phone gaming consoles, said yesterday that it had moved its European, Middle East and Africa headquarters to Swords, in north Dublin.
Company vice-president and managing director of the unit Ed Moro told a press conference in Dublin that the low corporate tax regime was a factor in its decision to move the European headquarters from Haarlem in the Netherlands. "It certainly was part of the consideration; it certainly was not the determining factor."
Other factors included the availability of skilled multilingual sales, marketing and finance personnel in Dublin. SanDisk said it will immediately recruit 18 additional staff to its team of 12 in Swords and Minister of State for Enterprise Tony Killeen indicated that it was likely to employ another 20 by the end of 2007.
The company, whose share price had the biggest percentage increase on the Nasdaq market last year, is the latest international operator to take advantage of new rules introduced by the Government to encourage groups to locate their European headquarters in the Republic. These include the world's dominant cereal-maker Kelloggs and Google, the internet search engine giant.
The Republic is considered an attractive location for such groups because they do not have to pay stamp duty on the transfer of intellectual capital from a unit in another country into Ireland. Specific incentives also reduce the tax on the profit that Irish-based holding companies gain on the sale of subsidiaries.
Mr Moro indicated that the move of the headquarters to Dublin cost the company less than $500,000 but said it would have cost "10 times more" if it had waited another two years before making the change.
SanDisk has manufacturing operations in Japan in a joint venture with Toshiba and its products are used as components by technology manufacturers such as Nokia, Ericsson and Motorola. The company has 315 US patents, 160 patents outside the US and licensing agreements with Intel and Toshiba.
Following the opening of the headquarters unit in Swords, the company is starting a big marketing push to establish its name as a "consumer brand" in Europe and establish a presence in the Middle East and Africa. It wants its Sansa line of branded MP3 players to become the second-biggest in the market, after Apple.
SanDisk invests heavily in research and development but Mr Moro's colleague Greg Rhine said "the initial thrust will be on the business side" in Ireland. The company will "probably not" locate a manufacturing operation here, he said.
Established in 1988, the company had revenues last year of $2.3 billion.
