DuPont's CEO on executing a Cross-Border Acquisition
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The document summarizes DuPont's $7 billion acquisition of Danish company Danisco in 2011. It discusses the challenges of implementing a large cross-border acquisition and ensuring proper integration between the two companies. The CEO and executives at DuPont worked for 6 months on the deal. Their approach was to take a long-term view, thoroughly integrate the companies to realize synergies, maintain cultural fit during integration to avoid post-acquisition problems, and clearly communicate the vision and goals of the combined company to employees.
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DuPont's CEO on executing a Cross-Border Acquisition
- 1. DuPont’s CEO on Executing a Complex CrossBorder Acquisition A PRESENTATION MADE BY STUDENTS OF GROUP 12
- 2. ARTICLE OVERVIEW Case Issue Case Highlights Executives at DuPont worked for 6 months on the $ 7 Billion acquisition of Denmark’s Danisco Challenges in implementing a Cross Border Acquisition Ensure Proper Integration between DuPont and Danisco Getting Synergies out of the Acquisition
- 3. DUPONT CORPORATION *Founded as a 200 Year Old Chemical Company Petroleum 33% Advanced materials 36% *Enhanced focus towards BioSciences as part of their strategy Chemicals * Evolving Portfolio of Businesses along with changing Industry Dynamics *Focus towards Organic Growth towards the Mid-2000’s *Resilient in the Economic Recession on 2008 *Looked to achieve linear and organic growth through Mergers, Acquisitions and Joint Ventures Textile Fibres 20% 14% Coatings Advanced Materials 11% 18% Chemicals Agriculture, Food and Biosciences 11% Coatings 5% Agriculture, Food and Biosciences 6% 33% 1996 1996 2011 $43,810 Million Sales Into Major Markets $43,810 Million Sales Into Major Markets $37961Million Sales Into Major Markets
- 4. THE DUPONT WAY Keep All Deals Close Have a Long-Term View Integration and Synergy • Executives must never be passionately overrun by any deal • Executives must always look at value creation to the company and the price they are paying for that value • Ensure Cultural Fit – Post Integration Problems • Understanding of Business in critical – Segments, Market Shares, Dynamics of Competition • Acquisition is only the first step – Regulatory Barriers existed in completely acquiring Danisco • Understand true value the acquisition brings to the firm – This may increase premiums paid to acquire the firm • Chart out an integration plan for all departments • Plan for Labour redundancy and plan for their redeployment • Communication to the employees the vision and the goals of the firm and ensure their employment security
- 5. THANK YOU