57 / 116
future will look like for all who
helped you arrive at this day.
Know your new partner.
The
time to gain comfort with and
confidence in each other is early
in the transaction—before a
deal is signed. Youwant to do
all you can tomake certain that
the ‘marriage’ will work, that the
parties are a good fit culturally,
that the two companies have a
shared vision, and that the roles
and responsibilities post-closing
are acceptable to all. Contracts and
professional guidancewill paper
the deal. But a lawyer I onceworked
with gaveme some good advice:
“A great contract with bad people
is a bad deal …a bad contract
with great people is a good deal.”
This axiom is true for both sides.
Do the best you can to ensure you
will be working with good people
on both sides sowhen an issue
arises—and issues will arise—your
first move is not to pull out the
contract but to suggest a discussion
where each of you has confidence
in the other to be thoughtful and
reasonable. Making sure that you
find a partner with a long viewwho
will be reasonable in good and bad
times is critical to a goodmarriage.
Communication and planning
are critical.
After an acquisition,
employees don’t knowwhat to
expect. While owners have been
through the diligence period,
havemade this critical decision
and have become comfortable
with its implications, most owners
try their best to keep their plans
secret. Many times, employees
are finding out the ‘great’ news
at closing.Throughout the
negotiation, the selling owners
must balance the legality of what
can be shared with what they wish
to share, while appreciating that
employees on both sides of the
deal will engage in speculation.
Throughout the sale process, doors
will be closed, strangers will walk
into offices, conversations may be
overheard and the rumor mill will
start to churn. Employees will be
understandably nervous about
their positions, their compensation,
what changes will occur and,
selfishly, how it all impacts them.
Understand this: while youmay
be celebrating, sharing smiles,
handshakes and a toast with
your employees, internallymany
employeeswill be uneasy.Managing
the human and humane side of a
deal is key tomaximizing the deal’s
value for all involved. Effective
and consistent communication
on all sides is critical.
Employees and integration.
Assessing the culture and strength
of both companies is imperative.
Getting disparate cultures tomesh
well is a difficult task. Naturally,
during the process of integrating
companies, employees may
show resistance to change rather
than embracing new policies,
procedures and sales methods.
It is crucial to determine who the
social leaders are within a company
and engage their assistance in
understanding and implementing
your new, shared vision. It is always
about the people.This is easy to say
and hard to do.
Know your strengths.
Hopefully
the acquiring company has
undertaken a comprehensive
review of its own strengths and
weaknesses, and how the acquired
company supports its vision.This
path should be clearly articulated
with both parties and agreed to in
advance of closing.
The success of many acquisitions
may be blunted when two
companies continue conducting
businesses independently without
amove to a shared vision.
May the best idea win.
What
does the acquiring company offer
to you that you do not possess
independently? What do you have
to offer the acquirer? Howwill this
opportunity present a win to you, a
win to your employees and a win to
the acquirer?
Find a partner that embraces
change—where the best ideas win.
Getting two companies tomeshwell
is a daunting task. Employees and
owners alike are concerned about
what lurks in the darkness after the
combination is announced.
Having lived on both sides of
the transaction, I share some final
thoughts: Life is different after
acquiring and being acquired,
but different can be invigorating.
If you take your time to find the
right partner, the tradeoffs and life
post-closing can bewhat youwant it
to be. Youwill have extramoney in
your pocket. Youmay be able to shed
theworry about HR, IT, accounting,
financing, etc. For whatever you do
not enjoy, therewill be teams to take
care of these details. Adeal should
free you up to dowhat youwant to do
andwhat you do best.
Brian Abrams is a CPA, lawyer
and currently serves as executive
chairman of Chicago-based
distributor Corporate Imaging
Concepts, LLC.This year Corporate
Imaging will servemore than 1,000
clients, process more than 125,000
online company store orders, and is
among the industry’s top distributors
in revenue. Most recently, Abrams
was honored as ASI’s Distributor
Entrepreneur of the Year.
Do the best you
can to ensure you
will beworking
with goodpeople
onboth sides so
when an issue
arises—and issues
will arise—your
firstmove is
not to pull out
the contract
but to suggest a
discussionwhere
eachof youhas
confidence in
the other to be
thoughtful and
reasonable.
|
NOVEMBER 2016
|
55
GROW