DP: ASI retains the management team of the acquired company
The issue of which organization assumes the liabilities comes into play when the acquired company
will cease to exist after the transaction.
Ewing points out that only some of the board members of the acquired company
will transfer to the new board and so there is the need to purchase tail coverage for directors and officers for a certain period "so that if anything resurrects itself, at least that coverage would be there," he said.
HCC Chairman/CEO Peter Quandt said the acquired company
"is well-regarded in its market segment and is an ideal complement to our Oakstone Medical Publishing business.
Review, revise and integrate policies, procedures and Sarbanes-Oxley Section 404 documentation of the acquired company
into the acquirer's.
The identification process becomes more problematic, however, if the acquired company
is publicly held because many shareholders choose to have their shares held by a nominee instead of in certificated form.
Thus, goodwill is no longer only associated with the net assets it was acquired with, rather it is associated with a larger part of the acquired company
, known as the reporting unit.
Consequently, the acquired company
never became one with the acquiring company.
At Saint-Gobain, "success" means we achieve synergy, and therefore get the financial results we expect from the acquisition; and the best people in the acquired company
decide to stay.
Other rules apply when the loss relates to a lower-tier subsidiary of the acquired company
Help reduce any "culture shock" by identifying key company or country cultural characteristics of the acquired company
and the acquiring company to assist in communications.
A study conducted by Mercer Consulting Group, indicated that the problem with recent acquisitions seems to have much less to do with faulty selection -- or with paying too much for an acquired company
-- than with what went on after the deal was sealed.