On the acquisition trail with the CEO next door
I see continual reports of one IT company taking over another IT company to "realize synergies" or "complement and grow our business". Everyone's doing it - Oracle with its drawn out PeopleSoft acquisition, Symantec buying Veritas, EMC getting SMARTS (and not before time) and IBM snapping up Ascential, although they also bucked the trend by selling their PC division.
If it's good enough for the big guys, it's good enough for me, and I initiated a hostile buyout of the house next door. Although both houses provide the same service, principally in the areas of hospitality and shelter management, adding the second house extends both our reach (they have a bigger backyard) and our vision (they get a view of the mountains).
This acquisition should realize significant equipment savings - we can rationalize our gardening implements and won't need two lawnmowers anymore. It positions us to consolidate living areas and increase our departmental specialization - I want to put all the kids' rooms in the other house, leaving ours just for adults. It's a move being welcomed by both departments.
There was no objection from the ACCC as there are still more than a dozen houses in our street. Even so, the takeover did not go smoothly.
I initially offered to pay market value - well, the lowest of three market values. It was flatly rejected. I unsuccessfully went back with the middle value. Shortly afterwards, and feeling like I was now visiting the three bears, I offered the highest value. This time the door wasn't slammed in my face so I knew I was getting somewhere. But the neighbour's wife was still not keen, talking about intangibles like community values and a sense of belonging, and she didn't see the cash as the benefit both I and her husband were espousing. Eventually she caved in under pressure from the majority householders.
Obviously, with any takeover, there is trouble adjusting to a new culture and new processes, such as when I changed their locks to be keyed alike with our place. However I made a point of assuring them that I had no plans to make them leave and their current position next door is completely secure. This confirmed all of their uncertainties, and the following morning they were fully packed and loading the van.
In a happy coincidence, it turns out my brother happens to be looking for a place, and this one is perfect for him. He moves in tomorrow.
As is common with many corporations, this takeover has left me a bit cash poor. My financial controller demanded I look around for what non-performing assets I could liquidate to re-establish my cash flow position. In fact, she stood with me as I looked, pointing to my shed at the end of the garden. It's true the shed has not been heavily utilized in recent fiscal years. Her view was stronger, stating the shed department's efficiency has never been good, frequently missing deadlines, failing to complete projects and was continually distracted by non-strategic activities, particularly when the footy was on the TV out there.
Len, my neighbour on the other side, has been using the shed a bit over the past couple of years as he doesn't have one. Maybe Len could buy my shed, giving me additional capital to fund my takeover. So I called Len over, offered him the shed, the tools and all the unfinished projects, which I called goodwill. He called it good joke, but accepted and offered, for a small fee, to complete my unfinished items for me to use as if I'd built them myself. I agreed to those terms as that'll make the boss happy, something I'm having trouble doing on my own.
Maybe she'll offer me a redundancy package.
Bruce Kirkham is a veteran IT professional specializing in leading-edge technologies and scepticism, who views the IT industry not so much as "dot com" as "dot comedy"
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