LISTENING BE4 – MERGERS AND ACQUISITIONS

Task 5.1:
In the interview, Susan Barratt, a Financial Director, talks about the successful
integration of a new business.
Listen and complete the passage with NO MORE THAN THREE WORDS

I think, an acquisition and the success of the integration of that acquisition is all about
(1)…………………….………. It can be a very complicated, intricate process and it has to be
planned very (2) ………………………….……… in my view. And then I think there are two
sides of success, one, what I would describe as (3)……………………………… and the other as
(4)……………………………

[…] Now the hard, by hard, I mean (5)……………………… of things. So, we are looking at
making sure we (6) …………………………… and financial goals we set out to achieve. And
make sure they happen within a timetable that's (7)………………………, so if you're
rationalizing units or rationalizing (8) ………………………, rationalizing departments in any
way, you need to get on with that very quickly, and make sure that (9)………………………
of that action is planned and thought through and done properly.

On the soft side of things, it’s about (10) ……………………… I think once you go through an
acquisition then people generally think the worst if there's a vacuum of
communication, if there's a (11) ………………………of what's going on, people will think
the worst but then that's (12)………………………. So, communication of what's happening,
telling people exactly what's gonna happen and by when is vital to make sure there's
(13)……………………… of a business.

Answer:
1. planning in reality.
2. carefully and precisely
3. hard success criteria
4. soft success criteria.
5. the financial side
6. achieve those strategic
7. acceptable
8. locations
9. the implementation
10. communication
11. vacuum of knowledge
12. human nature
13. a good integration
Task 5.2:
Listen to the second part and choose the best ending to the following sentence.

According to Susan Barratt, acquisition has been successful when:

a) you improve efficiency

b) open up new markets
c) add value to your business.

Task 5.3:
Listen to the third part of the interview. Susan Barratt gives an example of a
successful merger.
What reasons does she give for its success?

- …………………………………………………………..
- …………………………………………………………..
- …………………………………………………………..
- ………………………………………………………..…
- …………………………………………………………..

Answer:
be well communicated
know exactly what was happening,
the name changed very quickly on everything
literature changed
processes were solid.
Task 5.4: Listen to Professor Scott Moeller, Director of the Mergers & Acquisitions
Research Centre at Cass Business School.

What three reasons does Scott give for the lack of success of some mergers and
acquisitions?

- (1)……………… ……………… :
+ the strategic plan behind the acquisition tends not to be grounded
+ more of an opportunistic basis

- (2)……………… ….………….. (on the target company):

+ is done (3) ……………. …………….. ………………
+ does not focus on (4)……..…… …….…..….. ……………… driving to success in the
future.

- Lack of planning for (5) ………..…… ………..…… ……..….….:

+ the focus of management tends to disappear
+ go on to some other (6)…………….. …………….. and forget that hard work takes
time.

Answer:
1. inadequate planning
2. due diligence
3. much too quickly,
4. the key factors
5. post-merger integration period
6. strategic initiative
Task 5.5: Listen and answer these questions.
1/ Why is it sometimes better for the newly acquired company to be:
a) kept separate for a period of time?
……………………………………………………………………………………………………………………………………
b) integrated very quickly?
……………………………………………………………………………………………………………………………………
……………………………………………………………………………………………………………………………………

2/ What do you need to determine in addition to the speed of the merger?

……………………………………………………………………………………………………………………………………
……………………………………………………………………………………………………………………………………

3/ What other questions does Scott say you need to ask?

……………………………………………………………………………………………………………………………………
……………………………………………………………………………………………………………………………………
……………………………………………………………………………………………………………………………………

Answer:
1. a. to understand that company better or if you want that company to operate as a
separate subsidiary.
b. to make sure that you don't lose customers or employees, or there's something that has a
very time-critical element.

2. whether you want to impose your own culture and way of operations on that company,
or to keep that company's own culture separate,

3. are you going to appoint somebody from the company itself to run that division
do you want to bring in new management, from the acquirer's own management, or from
the outside?

Task 5.6: Listen and complete the text.

Orion Technology Partners yesterday announced plans to buy Rowland
Consulting, a rival pan-European e-business consultancy, for $ (1) ................m in
cash and shares. A windfall of $ (2) .................m in cash will be shared by
Rowland's (3)……......... partners, who founded the Vienna-based business in (4)
................ The remaining payment comes in the form of about (5) .................m
shares and options for shares.
Rowland's partner group is expected to receive (6) .................m options vested
over (7)…............. years, while its employees will get (8)..................m options
vested over (9)................. years.

Answer:
1. 640 2. 27 3. 19 4. 1999
5. 6.8 6. 3.1 7. 3 8. 1.1 9. 2