Mergers and Acquisitions

The term “Merger” describes the highest form of strategic

partnership, in which two or more legally independent

organizations merge together to form one organization- both

legally and in economic terms

What’s Communication got to do with it?

The Unfolding of a Merger

Assessment and Readiness

Negotiation

Immediate Pre – merger

Legal Merger

Immediate Post Merger

Integration

Stake Holder Group Problems and Resistances

Board Members/ DirectorsFear of a dominating partner, Hostility of CEO’s of partnersGeographic issues/Financial issues

CEO/ Senior managers Losing game? Loss of responsibilities and tasksUnclear organizational structure

EmployeesLack of understanding of need of merger, Job security,Compensation, Role & Location change, uncertain future

CustomersBrand issues/management of ‘my’ account, price/ delivery/Product/ quality issues/ technology

ShareholdersReturns, Dividend payments, Altering ‘my’ ShareholdingPattern

Government /Financialinstitutions

Revenue/ Tax/ Governance/ Regulatory issues

Vendors/ Suppliers Loss of business, future direction

Stakeholder Perceptions

Develop the Integration strategy

Integrate Systems Operation

Keep managing the institution

CEO takes leadership position

Deal with “What about me?”

Ongoing through merger

Establish The Power Structure

People & Communication

Key Issues in Integration

People – What goes on in their minds

Maslow’s Heirarchical

Needs

Self Actualization

Self fulfillment

Self Esteem, Feeling good, Pride, Confidence

Love & Belonging

Safety : Security from attack

Hunger and Thirst

What Is ourStrategy

How are we going to win?

What will my job be?My role in the Organization.

Who are the people I have to spend the rest of my life with?

Will I have a job? Will there be layouts?

Merger Communication

A strategic Communication Game Plan

Managing the expectation of all Stakeholders

Positioning the perception of the venture

Rationale for synergies and strategies

Key messages – general and specific

Managing brand communication

The Communication Strategy

Start early Anticipate employee questions and concerns Use all the communication tools Set communication expectations Over communicate Communicate the business case

Internal Communication

Key Components

Move fast , but to a well thought – out plan Do not over promise Broadcast information to all employees Keep employees focused on customers Identify change agents Create an acquisition communication team Create help desks/ helpline/ help emails Do a comprehensive Q & A for employees

The Business case – What employees want to know

What is the New Company? History, Vision, Customers, Achievements, Structures etc.

Who is the leadership? Why the acquisition? What is our outlook as part of the New Company? How does it fit into long term goals? What are the advantages for customers and shareholders? What is in it for me?

Communicating the Business Case

Core Messages

Customers Regulators Government Employees Shareholders Vendors/ Suppliers

Principles of Communications

Treat ALL impacted staff with dignity

Timing of any announcement to take into account the needs of all stakeholders

Share all information known that is relevant

Ensure consistency of message in both organizations

Available to listen i.e. Strong feedback loops

Empathetic, understand the people implications

Use line managers a key communications whenever possible after launch

Supporting through provision clear guidelines

Flexible to their needs e.g. different cultural context

A clear agreed timetable of events and responsibilities

Face to face communication wherever possible

Communication Content

Communication Content

Mergers and Corporate Culture

How is Corporate Culture determined? History Management styles Values Beliefs Systems / Structure

The way we do things here

Merger and Culture

Cultural differences Cross – national Cross – organization Cross – functional

The dynamics of culture conflict Realization of differences Accent on highlighting differences Mutual stereotyping and blame game Battle for cultural dominance

Merger and Culture- Identify Cultural Difference

Check List

CharacteristicsOf culture

Perception of other organization

True False

Other Perception

True False

Democratic

Bureaucratic

Autocratic

People driven

Team orienting

Transparent/Open

Long term driven

The Integration

Planning for success

Guiding Principles of Communication

The Communication team

What people want to know

Tools to support effective communication FAQ’s

Process for staff to submit quarters

Feedback mechanism

Merger newsletter

Walking the Talk

Important Lessons

A merger is a planned crisis

Culture can be used as a management tool

People are messengers and messages

Many leaders, many projects, many issues

Brand and customers must be paramount

Get help

Standard Chartered Grindlays integration update 19 May 2000Key messages

The sale is a good deal for both companies

We can realise the full potential of the business making us No. 1 or 2 in the regionThe price we paid is right Shareholder value

Focus Narrower deeper options Narrower geographic focus New economy New opportunity in Asia -

Internally

We will be the leading company [insert area] and the regionThere will be great opportunities as we develop the new businessUntil then it’s business as usualThere will be changes – but they will be carefully considered by the new managementWe will communicate with you regularly, openly and honesty

Standard Chartered Grindlays integration update 19 May 2000

Letter from the CEOWhat is happening – background informationWhy it is happening – context for change When is it happening – high level time-line of eventsWhat this will mean to me- Overview of HR processes, options etc Who is the other guy? (Brief intro, cultural information and the map showing fit)What’s next? - What does it mean for my customers?– Integration processHow do I find out more? – key contacts, Internet addressesQuestions and AnswersManaging Change Counselling contact points and service

Communication Content

Standard Chartered Grindlays integration update 19 May 2000Questions and Answers

Will my job be safe?answerHow will the best people for the job be determined?answerWhen will I know about my role?answerWill my reporting lines change?answerIs there going to be an opportunity to take voluntary redundancy?answerWill the branch where I work remain open?answerHow will it be decided which branches remain? answerIf my branch is closed will I have to move to another location?answerWill we retain our name?answerWill the merger impact my benefits under the of pension scheme?answerI have a loan– How will it be treated after the merger?answer