CHRONICLES OF M&A INTEGRATION

I'm joined today by my Global PMI colleagues Michael Scherer and , Jon Burke and we are listening to Jon as he walks us through his personal and somewhat accidental journey into M&A integration.

Jon's story like many of us starts with his corporate career in an organisation that was making multiple acquisitions. Somewhat disillusioned by the limited communication, Jon stepped in and proposed a communication strategy that could help 'sell' the acquisition both internally to employees but also externally. Before too long, Jon was being asked to help finance quantify some of the likely benefits and regularly being in the wrong place at the right time, he found himself bit by bit getting more and more involved in the acquisition integration process.

There are several lessons from Jon's story, but the one fact that stands out is that Jon's M&A experience is built on solid corporate experience, meaning he's not afraid to roll his sleeves up and get involved in making things happen. 

In this episode I'm joined by my  Global PMI Partners colleagues, Michael Scherer and Jon Burke M&A integration is a pressured and stressful environment at any time and it's an environment that calls for deep experience that goes well beyond following a bouncing ball. In fact the skills of a merger and acquisition integration consultant sometimes extend way beyond those that we would normally expect. 

Michael  outlines his experience of a scenario that developed when two executives decided to publicly and vocally air their disagreements during a project review meeting that included the CEO, the PE sponsor and the entire sale organisations from the acquiring and acquired businesses.

Listen to how Michael managed to help defuse the clash of personalities and turn a potentially damaging situation into a positive outcome for all concerned. 

This week we are joined by Robert Sher, Founding Principal of CEO to CEO, A consulting firm helping mid-size CEO's build their skills to lead their companies to exceptional performance.
Our conversation examines  CEO's who have founded a successful business because they are great engineers or have a particular talent, and now that the business is starting to scale, or there is interest from a private equity investor, they find themselves to unable separate from their entrepreneurial roots and adopt to the expected leadership model.

Robert makes the point that trying to change such individuals is counter-productive and what is really needed is to work with them and aim for incremental change that doesn't in any way damage their entrepreneurial spirit and value to the business.

Robert is based in San Ramon, California and for those who would like to know more he can be contacted through the CEO to CEO corporate website or via email [email protected]

Our guest in today's podcast is Lisa Beth Lentini Walker, the CEO and Founder of Lumen Worldwide Endeavours, a business that helps good companies and executives make better choices  with compliance governance and risk  So you're probably wondering what that has to do with a Amygdala Hijack?

Well listen to what Lisa Beth has to say and you will understand her view that in any business, and particularly where M&A integration is concerned, Compliance, Governance and Risk need to be a critical part of the early considerations and actions, and shouldn't / can't simply be 'left to later'. 

Lisa Beth argues that these topics go well beyond legal and financial consideration and that left unattended will not only impact the very well being of the business and its people, but it will have external ramifications to your brand image and position in the marketplace.

Would you ever consider that gold prospecting and M&A integration have some very close parallels? Well according to my colleague George Bennett, there are some very close parallels

George offers that four guiding principles learned from his gold prospecting hobby can just as easily be applied to the complex world of M&A integration

1. Bring the right tools
2. Follow the seam
3. Move earth
4. Don't forget the big picture

Listen to George's story and you will understand how gold prospecting and M&A integration have so much in common.

In today's podcast, I'm joined by my Global PMI Partners friend and colleague,  Matt Podowitz  
Matt is going to walk us through the pro's and con's of two very similar transactions that had very different outcomes. Transaction A and Transaction B both were add-on acquisitions to existing platforms, and both were being executed and integrated in a similar manner. 

Both transactions were structured as asset purchases to leave behind liabilities. The investment thesis for both envisioned consolidation of SG&A functions and rationalisation of PP&E to create cost synergies, and both anticipated revenue synergies through cross-sales of products to existing customers of the platforms. 

Both transactions were closed at a price favourable to the buyers. Transaction A was a runaway success. Transaction B failed to meet any of its targets for the Buyer and ultimately was re-sold at a loss.

What was the difference? The buyer in Transaction A engaged a team to begin developing a high-level integration strategy and start integration planning during the due diligence period. The buyer in transaction B did not.

In this episode, we are joined by Global PMI's Nordics Partner, Michael Holm. Michael has more than  10 years experience with acquisitions and carve out's   in multiple countries.

Michaels  start point in this podcast is that carve-out's are more complex than acquisitions and particularly so  when it's a Private Equity buyer, because there is usually no target company to integrate into so everything must be done to ensure the carve out can 'stand on it's own two feet'

Michael also points out that sellers will usually prepare the carve out in financial and legal terms, but it's the myriad of operational details that  guarantee the route to success.

As you listen to  Michael talk about his experiences, you will recognise that there is no area of a carve-out that isn't impacted in one way or another and that in some cases the carve-out business needs to be fully functional and operating smoothly just 24 hours from deal close.

My podcast guest and colleague Anand Pathuri, takes us through his involvement with the famous J.P Morgan, Bear Stearns acquisition of 2008. Not only was this an acquisition 'forced' on both parties by Reserve Bank Chairman Ben Bernanke, it had a minefield of challenges.

• It took place during the Global Financial Crisis
• A wide gap in customer experiences and scale
• An unrealistic integration timeline of just 12 months
• An atmosphere of fear and continual loss of good people
• The unwillingness on one side to engage and assist with the integration

So listen to Anand tell the story of how a non-conventional approach built the foundation for successful integration and how soft skills persuaded key people to provide their time and knowledge as part of a committee style Integration Management Office.

Fascinating listening and enough to make anyone shudder and be thankful that it wasn't them having to sort this out.

In this episode we are joined by Sergio Bruno, Global PMI's Partner in Italy. Sergio talks about his latest book 'Feelings and Competencies of an M&A' The very soft side of M&A integration.

Sergio maintains that companies have a personality made up of behaviours and emotions comprised from a collective of all of the people working in the company. We often refer to this 'personality' as corporate culture.

Sergio outlines his view that the company personality can have both positive and negative emotions and during M&A, these emotions can be very dominant.

Sergio argues that these emotions must be recognised, analysed and when properly managed they form a bridge across which M&A integration can be successful

Click here to order your copy of Sergio's book

In this episode, my colleague Anand Pathuri, talks about his experiences in emerging markets such as Africa and India and how it's important to 'break bread' with the locals in order to be accepted but also to tap into the undercurrents of how business is done.

Anand covers a lot of ground including why you should look out for the family dynasty and where power and decision making is concentrated. He also explains how important introductions are often only made when you have gained credibility in social circles (usually at a local bar or restaurant) and why it is critical that you engage local finance and legal expertise to help navigate the often under-regulated laws and regulations.