Conversations with Corporate Chieftains – Making Acquisitions Work, Sharing Experiences, Sanjay...
description
Transcript of Conversations with Corporate Chieftains – Making Acquisitions Work, Sharing Experiences, Sanjay...
Making Acquisitions Work Sanjay Dhawan, President
NASSCOM 2008: India Leadership Forum
2
April 13, 2023NASSCOM 2008 | CONFIDENTIAL 2008
Aricent
We understand the dynamics of
buying and selling.
We understand how to integrate
acquisitions.
We understand the dynamics of being bought and sold.
3
April 13, 2023NASSCOM 2008 | CONFIDENTIAL 2008
Aricent M&A history: 2004-2007
2004 2005 2006
HughesDeccanet
Avnisoft
FutureSoft
FlextronicsSoftwareSystems
(FSS)
Emuzed
Brain Blue
FSS
Azisa (South Africa)Azisa
frog design
frog design
Aricent
2007
Flextronics International ownershipKKR & Sequoia
ownership
4
April 13, 2023NASSCOM 2008 | CONFIDENTIAL 2008
Aricent Recent M&A Activity
In late 2007 early 2008, Aricent acquired• a Nokia Siemens Networks team
» 2G, 2.5G, 3G wireless» 100+ engineers» Southwood, UK
• DataLinx» Communications service provider solutions» 400+ consultants, developers and engineers» Tarrytown, New York, USA
5
April 13, 2023NASSCOM 2008 | CONFIDENTIAL 2008
Why?
It was driven by
industry changes &
customer demand.
6
April 13, 2023NASSCOM 2008 | CONFIDENTIAL 2008
The communications industry has evolved
Industry demanded a pure-play communications software company with superior skills, speed and scale.
So we built Aricent.
Yesterday: simplicity.
dial.ring.talk.
Today: complexity.
dial.click.channel.connect.download.record.talk.send.view.broadcast.
7
April 13, 2023NASSCOM 2008 | CONFIDENTIAL 2008
Why acquire?
Acquiring companies allowed us to enhance our
portfolio rapidly and comprehensively.
» Goal 1: offer a complete spectrum of
communications software services and products.
» Goal 2: accelerate revenue growth inorganically in
nascent sectors.
» Goal 3: give clients (equipment OEMs, device
OEMs, and service providers) a one-stop-shop for
increasingly complex, interconnected solutions.
8
April 13, 2023NASSCOM 2008 | CONFIDENTIAL 2008
Why be sold?
Becoming independent under the majority ownership of
Kohlberg Kravis & Roberts Co. (KKR) & Sequoia Capital
» gave us the complete independence to work with all
equipment OEMs, device OEMs and service providers &
» gave us the time and flexibility to fully integrate all the
software companies into a single entity, in preparation for
Aricent’s next stages of growth
9
April 13, 2023NASSCOM 2008 | CONFIDENTIAL 2008
The Three P’s
Aricent’s “Three P’s”
of successful M&A:
• Planning
• People
• Processes
10
April 13, 2023NASSCOM 2008 | CONFIDENTIAL 2008
1. Planning
Create, empower and unleash a clearly defined transition team
(from both sides of the transaction) ASAP!
» The team will accelerate the integration process.
» The team will highlights portfolio, cultural, and organizational
focus areas early.
» Have one or two (but no more) executives who are responsible to
senior management for all planning and execution.
Initiate these teams as soon as the contractual process allows.
11
April 13, 2023NASSCOM 2008 | CONFIDENTIAL 2008
2. People
From the buyer’s side, you must immediately seek out both the
formal and informal leaders within the acquired company and spend
significant time with them before and after the transaction closes.
» These people are critical to the long-term success of the integration
» The informal leaders can be excellent sources of the acquired
company’s general opinions AND be a conduit for informal
communications to teams at the purchased company.
» Discussions with formal and informal leaders should be frequent and
open: build trust.
12
April 13, 2023NASSCOM 2008 | CONFIDENTIAL 2008
3. Processes
The acquirer must be open-minded and prepared to evolve its
processes with each new acquisition.
» Sometimes the buying company has better processes.
» Sometimes the purchased company has better processes.
» Sometimes a combination of processes works best.
Never assume that the bigger company’s approach is
automatically better.
13
April 13, 2023NASSCOM 2008 | CONFIDENTIAL 2008
Aricent: The Art of M&A
• Before, during and after a transaction: there’s no such thing as too much planning.
• Successful integration after M&A requires “over communication” with teams.
• Bigger is not necessarily better: process change applies to the buyer, too.
14
April 13, 2023NASSCOM 2008 | CONFIDENTIAL 2008
Thank you.