Protiviti兼并收購(gòu)管理最佳實(shí)踐

1、2.3.6 Manage mergers and acquistionsBest PracticesOverview Mergers and acquisitions have been taking place at a tremendous rate in recent years. Nearly two-thirds of the new combinations, however, have failed to produce positive results. Reasons varied. Often, the two companies involved were simply

2、a poor fit. Sometimes integration progressed too slowly or company leaders overlooked the human element of the merger. Companies that apply best practices, however, realize their merger and acquisition goals by following a number of practices that ensure smoother integration and more satisfied emplo

3、yees, customers, and shareholders. These practices include using teams composed of employees from top executives to human resources (HR) personnel to take the lead in merger deals to help the company understand the risks and opportunities posed by the merger. The companies give HR personnel importan

4、t roles in the merger process to keep the human factor front and center during and after the deal. And best practices companies do not attempt mergers unless both companies find compelling reasons to merge, including cost reductions and growth potential. Finally, leading companies attempt to unite d

5、ifferent cultures, preserving profitable differences while achieving the financial benefits that come with integration. Best practices The best practices that follow describe many of the elements involved in successful mergers and acquisitions. They range from premerger investigations to postmerger

6、integration strategies.· Use strategy teams to spearhead the merger or acquisition.While investment bankers play an indispensable role in the merger or acquisition process, companies that apply best practices do not rely only on teams of bankers to execute successful business combinations. Best

7、 practices companies create numerous teams-most of them drawn from within the merging firms-to see the combinations through to successful conclusions. Each of the teams, which range from steering committees drawn from the highest levels of management to groups of internal auditors, brings its own se

8、t of skills and unique perspective to the pre- and postmerger process. The teams ensure that both companies involved in a potential combination understand and deal with the broad range of issues emerging during and after a merger or acquisition. Merger teams composed of accountants, managers, human

9、resources personnel, and others are sometimes combined with the services of an outside merger and acquisition team. Their insights ensure that each of the merging companies has intimate knowledge of the other firm's inner workings and of the challenges that face them as they combine operations.

10、That knowledge empowers both firms to make changes that ensure a better fit or, in cases of mergers with a high potential for failure, to scuttle the deal before it is consummated. Moreover, many of the merger teams remain in operation long after the papers have been signed and the bankers have depa

11、rted, ensuring that postmerger issues receive the same attention as the premerger planning.When pharmaceuticals giants Beecham Group of the U.K. and SmithKline Beckman of the U.S. joined forces in 1989 to form SmithKline Beecham plc, the firms made extensive use of multiple teams to offer savings re

12、commendations. The two companies created more than 250 teams who recommended potential savings of $800 million. Eight months after the merger, financial results for the new company demonstrated the value of the savings teams, with pretax profits climbing 15 percent. And, while many rank-and- and low

13、er-level managers were predictably worried and confused during the merger process, postmerger euphoria was fairly common among middle managers and top executives, reducing postmerger defections among key employees. · Give human resources a leading role in merger activities.While companies and t

14、he investment community have traditionally emphasized the financial side of mergers and acquisitions, it is the human element that often makes or breaks a corporate combination. That is why HR plays a leading role throughout the pre- and postmerger process. Companies that follow best practices have

15、found that mergers and acquisitions go much more smoothly when company employees remain well informed about current and impending changes. HR personnel are in the perfect position to spread the news through numerous meetings with employees.HR personnel can also be valuable during the due diligence p

16、rocess. While auditors and investment bankers are poring over financial and operational data, HR personnel can visit each office of the target company to assess the compatibility of the two corporate cultures, in addition to so-called "hard issues" such as compensation and staffing issues.

17、 By including HR representatives on the lead merger and acquisition committee, top planners can gain valuable insight into corporate culture as well as employee reactions to the merger. That information helps merger planners minimize the human toll of the new combination and further ensure its succe

18、ss. HR plays a key role on the senior planning committee at insurance giant Allstate Corp., based in Northbrook, Ill. Joan Crocket, Senior Vice President of Human Resources and a member of Allstate's management team, thinks HR's role in acquisitions is "to explore what would be a good f

19、it culturally, what areas can merge more quickly, expect payback from quickly-and for what reasons." She points out that buying and selling companies in the insurance business is all about skills and people, and, therefore, HR must be in a position to influence buying and selling activities.

20、83; Communicate a strong business case for the merger or acquisition.In order for any merger or acquisition to succeed, shareholders must recognize the value added by combining the two businesses. It is not enough for companies to identify willing partners in similar industries; they must identify a

21、nd communicate true growth potential resulting from a merger. Moreover, they must identify potential cost reductions to be achieved through realistic cost-saving synergies that will result in stronger earnings. With growth potential and cost-saving synergies uncovered-and often tested with merger si

22、mulation models-they can make strong, market-pleasing business cases for planned combinations.While these practices and market reactions may appear self-evident, nearly two-thirds of mergers and acquisitions fail to produce added value and are eventually frowned upon by the markets. For the merger o

23、r acquisition to win rewards from shareholders requires that projections for growth, cost savings, and improved businesses be shown to be realistic. Companies that identify compelling reasons for mergers or acquisitions before they enter into combinations are more likely to win the reward of improve

24、d shareholder value and avoid the loss in stock valuation that comes when mergers fail to produce growth or cost-shaving synergies. Most synergies take the form of overlapping capabilities such as marketing, manpower, or research and development. Two Swiss pharmaceutical firms, Ciba-Geigy AG and San

25、doz Ltd., provide a good example of how two merging giants can find and exploit significant synergies. In 1996, the two firms joined in a $27 billion union to form Novartis AG. Before the merger, the two firms had identified significant overlaps in marketing, research and development, and distributi

26、on. The merging firms projected job cuts of 10,000 and reduced overhead resulting from merging departments. The reality was even better.The new entity was able to slash 12,000 jobs, or 10 percent of the workforce and significant additional savings by reducing departmental overhead. Within three year

27、s after the merger, Novartis trimmed $1.23 billion from annual costs. · Merge corporate cultures carefully.While companies tend to focus on the financial, accounting, and legal questions before and during a merger or acquisition, issues surrounding corporate cultures are those that often make o

28、r break a merger after the papers have been signed. Areas of cultural compatibility range from hard issues, such as pay scales and pension plans, to soft issues such as how employees view a company's value system. Companies that follow best practices carefully address both kinds of cultural issu

29、es throughout the merger process, keeping employees of both firms informed at each stage of the process. Attention to cultural issues, such as uneven pay scales at the merging companies, helps ensure that the companies don't cause a merger to fail because executives concentrated on promising fin

30、ancial projections and neglected the human element of the merger.Companies that address cultural issues before, during, and well after a merger stand a much greater chance of succeeding as well-integrated businesses. This does not mean that all companies involved in mergers should strive to fold two

31、 businesses into one seamless entity. Some cultural differences between business units add value. Wherever possible, however, merging firms should smooth over cultural differences to ensure that the whole organization shares the same goals and values and that the next acquisition will go smoothly as

32、 the business continues to grow.When pharmaceuticals concerns Beecham Group and SmithKline Beckman merged in 1989 to form SmithKline Beecham plc, quickly defining a new culture was a major key to the merger's success. And defining a new, shared identity was a true challenge for the two firms. Th

33、ere were two different business cultures: one was scientifically and academically oriented, and the other was more commercially oriented. Moreover, Beecham was from the U.K. and SmithKline Beckman was U.S.-based. Joanne Lawrence, who was Vice President and Director of Communications for SmithKline B

34、eckman during the merger, explains, "To make the merger work, we found we had to develop an attitude that says, 'This is a new company. Things will be different.' Then we had to represent that symbolically in everything we did-from the vision and behavior of the leaders down to the logo

35、 of the new company on each employee's paycheck." · Design a merger strategy that emphasizes speed and initial success.Much of the success or failure of a merger or acquisition is determined by whether and how soon companies match shareholder expectations with real growth in earnings,

36、to keep at a minimum "flowback," or loss of shareholders who fear a loss in value. Best practices for merging firms include having in place a plan that satisfies those expectations as quickly as possible. Companies that get mired in leadership squabbles, slow integration, or unforeseen cos

37、ts lose customers, suffer diminished shareholder value, and end up among the nearly two-thirds of mergers judged to be unsuccessful.Companies that follow best practices move swiftly to integrate merger partners from the CEOs to line personnel. Moreover, these companies encourage cost savings through

38、 formal cost reduction programs and keep close tabs on their integration strategies, sometimes through a "merger dashboard," a set of sophisticated monitoring devices to track progress. Companies that can achieve those goals quickly are rewarded with superior customer retention and higher

39、market valuations. Some companies move deals forward quickly by agreeing to have two leaders for a time. In the merger between Credit Communal de Belgique (CCB) and Credit Local de France (CLF), co-CEOs helped move the deal forward and did not hinder the new company's ability to make important t

40、op-level decisions. The new entity, dubbed the Dexia Group, has become Europe's largest municipal lender. Co-CEOs Francois Narmon of CCB and Pierre Richard of CLF have planned and overseen numerous purchases of holdings in banks and insurance companies, including the recent 40 percent stake Dexi

41、a purchased in Credito Local, owned by Spain's Argentaria. · Identify and retain key personnel.The success or failure of a merger or acquisition rests on the shoulders of the people involved. More precisely, it rests on the quality and dedication of the employees working for both entities,

42、so merging firms must hold on to their best and brightest.Best practices companies identify key personnel early in the merger process and put a priority on ensuring that those individuals remain with the firms. They accomplish this by meeting with key staff early in the process and explaining the go

43、als of the merger and the important role the individuals will play in achieving those goals. The merging firms may offer financial or career perks to retain some personnel. Leading companies that retain key employees through good communication and effective incentives find much greater success in me

44、eting the goals communicated to shareholders. And they are far less likely to see their market value decline after a combination than companies who overlook personnel issues during mergers and lose hard-to-replace talent. When IBM Corp. decided to acquire Lotus Development Corp., top IBM executives

45、moved quickly to meet with key Lotus personnel. A week after the offer for Lotus was announced, and within a day of its acceptance, IBM CEO Louis Gerstner and John M. Thompson, head of IBM's software division, flew to Boston, Mass., to meet with Lotus employees before meeting with the press. Ger

46、stner commented that he valued the Lotus staff and culture and that he planned to ensure that they remained intact. After speaking at Lotus headquarters Gerstner, along with Lotus chief Ray Manzi, boarded a helicopter and flew to the Westford, Mass., headquarters of Iris Associates, a new acquisitio

47、n of Lotus and home of the Notes product. In particular, Gerstner wanted to speak with Ray Ozzie, head of Iris and creator of Notes. IBM considered Ozzie and his top people key to the acquisition's success. IBM officials stated their case during the meeting and Ozzie's people were generally

48、impressed with the straightforward nature of the visit. "My people are engineers-they are candid with their reactions," recalled Ozzie. "Gerstner and Thompson told us they were there to help and they would prove it to us."A. Use merger strategy teams to spearhead the merger or ac

49、quisition.Rationale Why apply the practiceWhile investment bankers play an indispensable role in the merger or acquisition process, companies that apply best practices do not rely solely on teams of bankers to execute successful business combinations. Best practices companies create numerous teams-m

50、ost of them drawn from within the merging firms-to see the combinations through to successful conclusions. Each of the teams, which range from steering committees drawn from the highest levels of management to groups of internal auditors, brings its own set of skills and unique perspective to the pr

51、e- and postmerger process. The teams ensure that both companies involved in a potential combination understand and deal with the broad range of issues emerging during and after a merger or acquisition. Sending in merger teams composed of accountants, managers, human resources personnel, and others e

52、nsures that merging companies have intimate knowledge of the inner workings of each firm involved in the merger or acquisition and of the challenges that face them as they attempt to combine operations. That knowledge empowers both firms to make changes that ensure a better fit or, in some cases, to

53、 scuttle the deal before consummating a merger headed toward failure. Moreover, many merger teams remain in operation long after the papers have been signed and the bankers have departed, ensuring that postmerger issues receive the same attention as the premerger planning.What companies gain· M

54、ore detailed understanding of challenges faced in the merger or acquisition· More productive interaction between the two companies · Enhanced readiness to handle problems as they arise · Greater postmerger savingsAction steps Improving the company's process1. Create a steering com

55、mittee drawn from the top management of both firms. Perhaps the most important merger project team is the steering committee. This team is composed of top managers and officers from both firms involved in the merger or acquisition and may include board members as well as CEOs, COOs, and other top ma

56、nagers. One of the primary functions of the merger steering committee is to establish and maintain open communications between top management of both firms to ensure that neither management team is caught off guard by problems during the merger process or later changes.During the merger process, the

57、 steering committee also communicates to employees of both firms and to the public the overall strategy, guiding principles, value targets, and top priorities of the impending combination. Those goals set the tone for all of the other project teams formed to handle the merger. It is crucial, therefo

58、re, that the steering committee translate its goals into clearly identifiable and measurable targets for the project teams to pursue.From the moment their impending merger was announced, leaders from telecommunications giants Nynex and Bell Atlantic Corp. joined forces to keep close watch over the m

59、erger as it unfolded. A special committee of board members from each company worked with CEOs Ivan Seidenberg of Bell Atlantic and Ray Smith of Nynex on a merger oversight committee that kept tabs on the evolving merger. When the deal finally closed, directors from both firms had already established

60、 open lines of communication that made melding the two firms that much easier. 2. Use teams of internal auditors in an expanded advisory role before and during the merger.While their involvement is often limited to the due diligence review that precedes mergers, internal auditors have much more to offer during the merger and