Vegetable seed breeding company

Our client is a third-generation family business specialized in seed breeding in the Netherlands. It exports its vegetable seeds to over a hundred countries worldwide. We support them in their move to be taken over by a large multinational listed on the stock exchange.

The Challenge

Take-overs are carried out with the greatest confidentiality until the deal is closed. Our client thinks it important, however, to engage everyone in the company right from the start, given the impact of their search for a partner to take over the company. Moving from being a family business to becoming part of a large international company in the sector is a momentous change. So, prior to them starting to look for a take-over partner, they decide to be transparent and inform their employees.

Their decision creates a special and challenging process. Our client wants us to think about questions such as: how do we deal with the emotions, upheaval and concerns that may well emerge at the initial announcement, while we cannot give any clarity about what exactly is going to happen. How do we manage any concerns during the selling process? How do we prevent people (and their crucial knowledge) from leaving the company in that period? How do we ensure the result of the take-over lands well and employees take a positive attitude towards working on integration?

Approach

Our role in take-over processes is managing change and communications, closely working with the M&A consultants and lawyers involved. The importance of this is that two perspectives are at play: the  M&A consultants focus on the ‘equity story’: the strategical financial pitch to potential partners. Within the organization the story must be about the future of the organization, its employees and what has been achieved together. M&A processes can go wrong at the start when both perspectives are not aligned well.

Working together with the Board and senior management, we develop an image of the future that is inspiring and realistic: How will the pending take-over help us as a company to get to the next level? What can a new partner bring? How will they support personal development, for instance? We are not looking for ‘a story’ but for alignment between Board and management based on truly felt convictions and beliefs. That makes it an intensive process. And they too are people who need to change their mindset and focus on a new future.

Nevertheless, this process is needed – and has proven to be effective – to be able to announce the intended move as well as communicate about it later convincingly. Employees will feel the conviction straight away, which more easily generates trust in the future and the process that will be taking place in the coming months. It lays the foundation for dealing with a period of uncertainty and keeping people on board.

We stimulate managers to keep discussing the change very regularly with their teams during this period. Their role is to provide transparent information about the take-over process, answer questions, and address uncertainty and emotions. All this helps to prevent rumors and  incorrect stories from emerging.

After the new partner is known, an announcement meeting has to be organized. This time, co-operating with the party taking over the company is important. Often, these tend to want to go in straight away and tell their own story while the ink is barely dry. Consistency with the image of the future depicted earlier is vital now. If that is not feasible for some reason, the image to be presented has to be managed carefully. We succeed in this for this client, thanks to the company’s close involvement.

Result

Our strategy results in effective leadership throughout the entire take-over process. And in addition, in employees having a perspective on and trust in the future before, during and after the take-over process. People crucial to the company have been kept on board. After the take-over, people feel the new owner is trustworthy, and that there is a solid base for integration.

Would you like to know more? Please contact Michiel van Delden.