Discussing Corporate Development in Saudi Arabia
“It is easy to be brave when far away from danger” – Aesop.
The above quote is an apt description of Corporate Development and CFO behavior over the past few years due to many companies choosing to accumulate cash on their balance sheets rather than deploy it for acquisitions. However, this is not to diminish the importance of taking a cautious approach in turbulent times as the aforementioned storyteller also sagely noted “It is thrifty to prepare today for the wants of tomorrow”.
While Aesop was roughly 2,500 years ahead of his time when relating these lessons to today’s corporate dealmakers, he would have been a welcome guest at the CFO Strategies Forum that I recently attended in Saudi Arabia as numerous speakers touched upon the issue of managing risk (and distancing themselves from personal liability) in an era of ongoing economic uncertainty. One of the central themes that emerged from the event was that organizations are adopting a more formalized approach to the evaluation and execution of strategic alternatives – and they’re seeking tools to help facilitate these complex processes.
The risks corporate executives are facing are greater than ever as regulatory bodies are increasingly vigilant in their oversight, not to mention the scrutiny they face from shareholders. There are many recent examples of post-close litigation or shareholder lawsuits alleging misconduct, which have had a damaging impact on the company’s stock price. Given this climate, it's no surprise that many of the conversations I had with CFOs revolved around IntraLinks’ ability to help minimize their risk exposure specifically when contemplating a merger or acquisition.
I had the opportunity to speak at the conference and I discussed how technology tools (such as IntraLinks) are changing the way companies conduct business. The focus of my talk centered on the need to leverage these solutions in order to adopt a more formalized and structured approach around their M&A efforts, and make better, smarter decisions. There was a time when Corporate Development groups enjoyed a great deal of autonomy but those days are a distant memory as CFOs and CEOs demand greater insight into the progress and status of these strategic transactions.
Many of the solutions that IntraLinks offers resonated during conversations with event attendees, including:
- Creating a centralized repository for capturing transactional information which is typically stored in email systems or hard drives
- Providing a hub level view that offers executives a snapshot of activity in the transaction pipeline
- Implementing strict protection around this sensitive material – as public disclosure can kill a deal
- Establishing a ‘living’ archive of deal materials - allowing internal teams to quickly locate previously generated materials for deals that have ‘come back to life’
Overall, the event was a great showcase for IntraLinks’ solutions and illustrated the clear market need for an integrated solution that meets the requirements of today’s corporate dealmakers. With our traditional platform tools and expanding set of Corporate Development capabilities, I think we’re well positioned to address this emerging market.