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Butrus
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Posted - 2003.09.14 00:01:00 -
[1]
Edited by: Butrus on 14/09/2003 00:38:19
I'm fascinated by the potential of organisations to grow via mergers and acquisitions, yet don't see much evidence of corporations taking this serious around me in Gallentean space.
I successfully negotiated a merger between Global Spanning Corporation and Terran Industries earlier this year, and would like to hear from other CEO's or directors interested in discussing their own experiences or opinions and theory.
My private goal is to futher increase the numbers of my current corporation by merging with similar minded Gallentean groups of approximately the same size, but happy to hear all views and perspectives to stimulate a topic that I believe is underexploited in our current political and economic system.
P.S. If anyone is contemplating a merger and wants an impartial facilitator I would be delighted to help out.
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Butrus
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Posted - 2003.09.14 17:00:00 -
[2]
Couch Monkey - glad to hear of another success story and I certainly echo your advice to take your time.
I'd be interested to know what initial barriers or objections you encountered from members of the respective corporations, and how you overcame them? Would you mind sharing a couple of examples so others can avoid (or manage) the same pitfalls?
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Butrus
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Posted - 2003.09.14 17:03:00 -
[3]
Ashton Black - I don't think the game mechanics force you down any particular route. In our case we simply agreed on which named corporation should survive, and everyone migrated to that one. We also agreed that there would be an equal number of directors from each former corporation, with elections for CEO after the first month. For good measure we issued equal shares to all directors, but this is by no means required.
We did also consider forming a totally new corp, but the practicalities of moving our joint inventory, renting facilities (offices, labs, factories) something we wanted to avoid, and so the only "compromise" was that one of the old corporation names was lost.
Were you just asking out of curiosity, or are you contemplating a merger yourself? Let us know if you'd like to discuss more...
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Butrus
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Posted - 2003.09.15 11:28:00 -
[4]
Edited by: Butrus on 15/09/2003 11:36:22
Dreamworks - thanks for an interesting and alternative perspective. I think what this suggests is that a merger of equals can be a very good thing, but a takeover where one group is disadvantaged is not a recipe for a productive and long lasting partnership.
I think mergers are similar to normal relationships - if there's a genuine win/win opportunity where both parties come out with more than they had individually, this is a great basis to start discussions. The key then is to check that neither side is being forced to give up something that is really important to them (a "core value"), while at the same time offering as much flexibility as possible.
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Butrus
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Posted - 2003.09.15 11:31:00 -
[5]
Couch Monkey - many thanks for sharing your experiences and for you summary of lessons learnt.
I particularly like the way you went about getting the two teams to meet and get to know each other. After all, if the individuals in each corporation can't "click" or "gel" then there's no way the management team can force things through (even if they wanted to).
Do you think you would consider merging again, or in retrospect was it a once in a lifetime kind of change?
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Butrus
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Posted - 2003.09.15 11:33:00 -
[6]
Edited by: Butrus on 15/09/2003 11:38:21
Iconoclast - thanks for your post. If name etc. are your core values it's good to be up front about that before going too far down the road. My current corporation doesn't seem to be what you're looking for by way of partner, but I'd be happy to get involved in any way as a facilitator if you'd find that helpful. Couch Monkey obviously has good experience too that you might want to tap into (if you ask nicely!).
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Butrus
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Posted - 2003.09.17 20:42:00 -
[7]
Interesting reading - keep it coming!
On a positive note, the recent patch has improved the Corporation menus a bit which is making life a little easier now:
- Better layout of applications screen
- Functioning list of assets and locations
- Impounded assets view (when you close an office and there's still equipment in the hangars).
Regarding the point about CEO's and leadership style, my first checkpoint in our recent merger was to understand the personal motivations of the two incumbent CEO's - why did they setup their Corporations in the first place? If their goals and interests align, and won't be diluted by one of them stepping down, then things might just work. Otherwise frankly the deal's off before it even starts.
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Butrus
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Posted - 2003.09.18 16:15:00 -
[8]
Civil Deity - many thanks. Always good to hear a megacorp perspective. I'm kind of surprise we haven't made more mention of "trust" in this topic so far - thanks for mentioning and reminding us how key that is!
I also really like your "naturual selection" idea about leadership. It's like a polite challenge - "If you're as good as you say you are, you'll naturally end up where you want to be. If you're not, then maybe you shouldn't be leading the newly merged megacorp...".
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Butrus
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Posted - 2003.09.18 16:17:00 -
[9]
Zaphod - many thanks - I had problems accessing your server but will try again later. The topic of alliances and how you breathe life into them is one the plagued many of us in Anarchy Online.
Maybe we need a separate conversation of some strong space-coffee for this one? Would be great to understand how you've tackled this problem...
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Butrus
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Posted - 2003.09.20 09:35:00 -
[10]
So is that it? Are we the only 10 people in the whole of Eve who have an interest or opinion in Mergers/Acquisitions?
Apparently it's true what they say about space being lonely...
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Butrus
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Posted - 2003.09.21 10:45:00 -
[11]
Edited by: Butrus on 26/09/2003 16:25:57
Thanks Mar Vel and Iconoclast - good to hear from you.
Regarding alliances... I think you're right. Alliances are similar to mergers in many ways, but obviously not so final. This may suit some corporations much better, for example where they share common values but have differences they wish to preserve. This kind of cooperation can bring great benefits, but the downside (or upside, depending on the circumstances) is it's not final and binding. In other words, you never really now if the other party will honour the alliance. Mergers on the other hand tie the incentives of the two organisations firmly together.
Regarding umbrella organisations... What an intriguing idea. I guess you're thinking about groups of companies where share ownership binds them together? E.g. XYZ corporation, a subsiduary of ABC Group? As you say, this could be tricky without the right game mechanics, but nothing to stop some of the mega-corporations effectively owning an interest in smaller ones by investing (e.g. lending isk or resources for an agreed purpose or financial return).
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Butrus
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Posted - 2003.09.26 16:24:00 -
[12]
Edited by: Butrus on 26/09/2003 16:25:04
Just in case any of you were thinking this is a purely hypothetical thread... Terran Industries is now in an advanced stage of negotiations with another similar sized Gallente corporation (whom we cannot name for due dilligence reasons).
We are putting into practice many of the suggestions and lessons mentioned by contributors to this discussion - for which we thank you - and we look forward to sharing the outcome of this latest endeavour with you in the very near future.
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Butrus
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Posted - 2003.09.28 12:34:00 -
[13]
Edited by: Butrus on 28/09/2003 12:34:23
Lol - thanks Couch Monkey.
The merger is definitely ON 
I am delighted to formally announce that by the end of September, Terran Industries and Triad Inc. will be merged into one corporate entity, retaining Triad's name.
I'll post a brief report after the dust has settled...
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Butrus
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Posted - 2003.09.28 12:39:00 -
[14]
If you see any associated discussion threads on the board, please post them here. Here are two I found recently:
Request for Merger
Potential Merger Partner
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Butrus
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Posted - 2003.10.04 13:10:00 -
[15]
Here's an established corporation looking to merge:
STK Scientific
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Butrus
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Posted - 2003.10.05 21:28:00 -
[16]
I'm happy to report a second successful merger under our belt! As of today at 21:00 Eve Time, Terran Industries was folded seemlessly into Triad Inc.
We are looking forward to some exciting times ahead with a greater combined pool of resources, including some very complimentary Blueprints.
It's still early days and the real transition has yet to happen. But all logistical arrangements are now in place - equal number of directors with full access to corporate funds and hangars, and all assets (liquid and tangible) have now been transfered and placed into storage.
Time will tell the fit is as good as it looks - but initial signs are promising and it has been a fun process so far.
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Butrus
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Posted - 2003.10.06 17:15:00 -
[17]
Samis - thanks for your enthusiastic and thoughtful reply. Regarding timezones, our latest merger has hit that issue head on - Triad Inc. are mainly US folk, and Terran Industries was mainly European. I'll let you know if I change my mind but so far it seems to be working well, giving greater coverage for operations and recruitment, a bit of cultural diversity as you say, and actually helps retain some of the "character" of the two previous organisations.
As you allude to, we do also have a suggested meeting time - usually about 18:00 Eve time on a Sunday - where the whole corporation gets together for some decent mining and socialising.
In terms of communications and keeping the interpersonal things going, this is a challenge in any corporation, not just newly merged ones, but I would say we placed great importance on getting people talking PRIOR to the merger and that's an investment I think which will pay off several times over.
Please keep us informed about your progress with your merger project - good luck and have fun!
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Butrus
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Posted - 2003.10.06 17:22:00 -
[18]
Temerlyn - thanks for sharing a tantalising insight into your recent merger experiences. Are you at liberty to share more details, e.g. size of groups involved, how you organised pre-and post- merger, whether there were any merger conditions, how you chose your merger partner, and whether you would do anything different in retrospect?
Thanks!
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Butrus
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Posted - 2003.10.06 17:28:00 -
[19]
Malikon - I don't know exactly what would happen if you simply left your organisation. I went through the following wind-down steps that might be a good CEO checklist for you to tailor to your own needs:
1) Ensure all members of your corporation have joined the new organisation and have appropriate powers and positions.
2) Clear out all corporate hangars*.
3) Un-rent all offices*.
4) Un-rent all research and production facilities*.
5) Tranfer all remaining funds from corporate wallet.
6) Resign as CEO.
7) Join new corporation.
8) Delay final transfer of money and valuable assets until any transitional conditions have been fully met.
* Very useful tool exists now from the Corporation toolbar icon. Go to Offices and Production to see all stations where you have corporate resources.
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Butrus
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Posted - 2003.10.08 16:53:00 -
[20]
Edited by: Butrus on 08/10/2003 16:59:20
Samis - Both mergers I've been involved with have taken about six weeks from initial contact. By no means a formular to be followed slavishly but here's how it panned out for us:
Week 0: Met a nice chap, got talking, discovered his corp was rather similar in size, shape, and philosophy.
Week 1: Held tentative discussions with my contact, then involved his CEO and my CEO.
Week 2: Things still looking good. Involved the management teams of both corporations to draft a straw man merger proposal. Presented it to the members of both groups.
Week 3: Held open discussions and joint mining events with members of both sides, formalised our decision with some internal voting, agreed a target date to start and complete the transition.
Week 4: Confirmed the merger was a GO! Started shuffling equipment, offices, and facilities. First members left old corporation and joined new one.
Week 5: All members except CEO have now joined the new corporation. Shares issued to directors, access to hangars and equipment sorted out, "get to know you" events coming thick and fast. All merger agreements honoured, time for the old CEO to pack up his bags, decommission the old corporation, salute the flag and restart his life in the new corp.
Week 6: First proper board meeting and general election of the new CEO.
P.S. To get everyone talking together I don't think you can do much better than lead by example. If the two CEO's and their management teams agree ONLY to talk on the shared channel in the lead-up to merger, other members will probably feel they're missing out on the fun and move there too.
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Butrus
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Posted - 2003.10.08 16:57:00 -
[21]
Yangja - many thanks for sharing your experience too. Good to know things can work out at the mega-corp end of the spectrum too...
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Butrus
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Posted - 2003.10.10 23:50:00 -
[22]
Samis - thanks. Yes, interesting dynamics when your corporation mates are real life acquiantances too... I'm not a psychologist but it does add a whole new dimension.
Good idea regarding office handovers. We were lucky in our last merger and actually wanted to move area anyway, but worth discussing between both groups so you don't miss an opportunity.
Good luck with YOUR merger - hope you'll be posting the details of a successful transition very soon.
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Butrus
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Posted - 2003.10.12 09:52:00 -
[23]
For those actively seeking a merger partner, or just wanting background information on existing corporations, I can recommend the following in-game websites:
The Gallente Portal
Eve Corporation Registrar
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Butrus
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Posted - 2003.10.19 21:09:00 -
[24]
Edited by: Butrus on 20/10/2003 18:00:35
OK several weeks on from the merger of Terran Industries and Triad Inc. and I'm happy to report we're still going strong.
Some feedback we received might be relevant to other people considering mergers too:
* Management team seemed to disappear in endless meetings after the merger, slow getting normal life started again.
* Would have been better to have first board meetings etc. prior to the merger so on Day 1 the Directors would announce a shared vision (goals, responsibilities, immediate priorities etc) rather than leaving this a few weeks.
* We should have organised more corporate events in the early days to help people get to know one another. Weekly corporate mining events are a great success now but should have been started earlier.
* CEO should have sent out more regular updates to all members via eve mail to let them know how things were progressing.
* Share allocations and permissions are still a bit messy. Advice would be to start very simply and make sure the CEO thoroughly understands the game mechanics of the corporation menus prior to merger.
My current project is a much looser kind of merger - promoting Gallente Unity with some wizzy in-game tools and resources.
That's all for now - I probably won't post any more until someone else decides to share their experiences. I don't want this to become a monologue!
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