Supporting a US Midwest integration team through an acquisition of an Israeli firm

Supporting a US Midwest integration team through an acquisition of an Israeli firm

Challenge:

One of the world’s largest manufacturing companies, based in the Midwest of the U.S., had an opportunity to acquire an Israeli firm with key technology, distribution, and market share. Importantly, the Israeli firm had access to markets in China and India that the U.S. firm did not have. The U.S.-based management team were eager to move quickly on the deal as part of their top-line growth M&A strategy; however, they were concerned about the integration of the Tel Aviv-based organization. This smaller firm was a Kibbutzim, a close-knit, family-run company with its own unique culture (both corporate and Israeli). The US firm, with its global procedures, policies, and systems, needed to tread carefully with this smaller, more entrepreneurial and collective company, so as to not overwhelm and push out its people.

Discovery:

Aperian Global was engaged to help the U.S. firm and its integration team to prepare more fully for the acquisition. This involved interviewing (in Hebrew) several of the key employees of the Israeli company on location at their factory. Positioned as an agnostic third party, this exercise enabled Aperian Global to learn which employees were absolutely critical to remain in place in order for the deal valuation to hold as expected. These employees, many nervous about the acquisition and pending change, had enormous loyalty from others in the organization, and with key customers in their distribution chain.

Impact:

After performing a mapping exercise of the assets, best practices, and relationships of both organizations, Aperian Global was able to recommend specific strategies to ensure a smooth integration. For example, in the course of our interviews, we discovered that one influential leader in the Israeli firm had the personal relationships that enabled the firm’s access in India and China. Making sure this person had face in the new organization, and was shown respect during the integration, was crucial in order for the asset value of those markets to remain. The acquiring firm was also better able to prepare the U.S. manager who was sent to Israel on assignment to drive the integration.

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