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Developing relationships & not just transactions in M&A…

June 4th, 2008 Comments off

     I’ve had the opportunity to be involved in a number of M&A deals and there was no one deal that was alike. All involved extensive effort and detailed work with the incumbent management team. However, there was one deal that I had the pleasure, and I do mean pleasure, to work on.  I believe that the work I did on this one particular project will shape my approach to future deals and how I work with potential acquisition targets.

     One of the CFO’s I had worked with asked me to meet with one of the V.P.’s within our company who wanted to present a potential acquisition for the business unit he was responsible for.  The target in mind was a small service-based business in the Southeast who he had been using for some 3rd party installation services. It was simply being viewed as a “review of the financials, do the deal, and bolt it on….”  Ummm, right…..

 Read my full commentary at CorpFinCafe

Views from inside a $6.5 billion merger machine….

March 25th, 2008 Comments off

Nothing prepared me for what would be a living case study in merger missteps.
     We were in the midst of a 3-year growth plan, were producing strong and improving results, and had finally achieved some stability in our management team when our parent company (Schneider Electric) announced the acquisition of our largest competitor APC in a $6.5 billion deal.  While no two changes of control that I had been through were alike, there are some basic premises that should be adhered to in order to ensure the highest level of success.  Unfortunately, the majority of these were tossed out the window in the merger between APC and MGE.  One of the more surprising elements to me was that Schneider took a very hands off approach and basically tossed our two entities into one large sandbox to “work it out”.  Aside from a newly assigned President and CFO from the parent company, the new management team was almost entirely comprised of APC personnel.  It made no difference that the majority of these folks were the same people that had failed to create value previously and subsequently drove their stock price to continual new lows and created and opportunity for Schneider to purchase their entity.  As with other situations in my finance career, this was certainly a living case study that I could take with me wherever I go.  Between my work with McKinsey, Boston Consulting, participating in the original “clean rooms”, and eventually the integration teams, it’s a combination of experience that I will take with me to my future companies. 
Although written in 2005, the following article by Kenneth W. Frank is a simple retro view about some of the more important aspects of merger work…after the financials!    Read
Making Acquisitions Work .

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