Case Study
How Clear Moves Consulting helped an independent telecom company bolster its competitiveness by guiding it through a complex $23m merger.
M&A
The Client
A 100-year-old independent telecom company located in Canada. The company offers various information technology solutions, including telephone, internet and mobile services.
Project Summary
Priorities for the Founder and CEO included:
- Build a comprehensive strategic plan for his company and then move to merger discussions.
- Verify the current market dynamics that supported the need to grow through M&A.
- Begin discussions with merger candidates in the same industry vertical.
- Ensure the board of directors can succeed by helping them to uphold their duties of loyalty and care.
Approach
- Identify ten stringent gateways that each organization would need to pass through in advance of signing the LOIs.
- Create a merger thesis and develop an industry specific critical path based on Clear Moves Consultingʼs M&A best practices.
- Begin and complete due diligence, present findings to board for either ‘goʼ or ‘no goʼ vote. Schedule SGM for stakeholder vote. Upon ‘goʼ vote from both boards, commence Post Merger Integration.
The Challenge
Upon arriving at the company in 2023, the CEO saw a bleak future in which only the larger players would survive over the next ten years. Merger considerations were initially presented based on metrics indicating a precarious future at best. Headwinds facing our client included expiring territory protection for fibre builds, uncertain mobile phone licensing agreements and an inflationary business cycle. The focal point of the initial merger discussions centered on creating a larger organization that could better withstand the onslaught of marketing and pricing pressures from its larger competitors. The result was a >85% ‘goʼ vote from stakeholders.
The Merger Thesis
With every engagement, Clear Moves Consulting is stringent in adhering to best-practice frameworks for all our clients. For our M&A guidance, we begin by developing criteria for several gateways that each organization must clear, then move on to the merger thesis.
The CEO made it clear from the beginning that the merger could proceed only if we met four key criteria. The merger had to be favourable to and provide significant advantages for:
- The company
- The employees
- The stakeholders
- The community
Solution & Implementation
- Conduct an initial confidential whiteboarding and gap analysis session with the CEO to set a baseline for all activities and develop a business case for his board.
- Enroll senior managers and conduct a strategic planning session, with one strategic pillar focused on growth through M&A.
- Present the strategic plan to the company’s board for approval and begin establishing contact with other CEOs in the vertical and geographic region.
- Follow-up for further discussion and final evaluation.
- Secure the merger partner by issuing and signing LOIs to begin due diligence.
- Create a process for completing, organizing and sharing the data from the due diligence for board approval.
- Prepare for, schedule and present the merger rationale at the Special General Meeting and secure a ‘go’ vote.
Keys to Success
- Begin with post-merger integration planning and work backwards.
- A firm commitment by the CEO and his board to stay with the Clear Moves Consulting designed critical path through the negotiations.
- Willingness on behalf of certain directors to relinquish their responsibilities that would come with a smaller board in the NewCo.
- Regular and committed executive team meetings led by Clear Moves Consulting to build and maintain adherence to the critical path.
- Create a proper and thorough due diligence process that included thorough preparation and training of the responsible workstreams.
Advantages Clients Gain by Choosing Clear Moves Consulting as Their M&A Advisors
- Strict adherence to the professional code of conduct set by the Canadian Association of Management Consultants.
- Helping clients connect with suitable partners at the right time.
- Delivering expertise through highly specialized skills.
- Alleviating stress and workload for leadership teams.
- Enhancing value generation, innovation and optimizing capital allocation.
- Uncovering quick synergies to lower costs and boost revenues.
Let’s Start A Conversation
Let’s discuss the possibilities for your organization.
We’ll provide you with a no charge analysis and some valuable insight into the different ways your company can benefit from Strategic Planning.