Mr. Knight has led the technical side of a number of Mergers & Acquisitions. Some have been outright acquisitions, whereas others have included investments or OEMs, with the option of a subsequent buy-out on very preferential terms.
When Mr. Knight was approached by one client to identify & manage a new acquisition, he was understandable cautious. "Due diligence is a major issue" explains Mr. Knight. "The client already had a previous record of bad acquisitions, where their due diligence had been lacking. This resulted in the client having lost a lot of money."
Mr. Knight started by thoroughly understanding the clients needs, perceiving an ideal solution, then searching the industry to identify suitable products and corporations to match the solution. His technical assessment of the products & companies included:
- Scope
- Marketability (potential, uniqueness, price point, barrier to entry, etc.)
- Design (best use of industry standards)
- Implementation (open ended, expandable, re-useable, maintainable, etc.)
- Quality & reliability
- Vision, goals & direction
- Staff capabilities
- Likely costs
"Some products were a real surprise" Mr. Knight noted, "Because in-spite of 'looking good' on the surface, the underlying technology was useless, and completely un-expandable."
Having found suitable companies & products, the next step was to structure a deal. Possibilities included a merger, an acquisition, an investment (part-ownership), OEM, or a simple license. After acquiring the corporation, there were a new set of challenges to address.
- Collaboration & coordination of engineering efforts
- Product integration (especially important if Wall Street are watching!)
- Re-use of code
- Merging / restructuring of software development groups, where appropriate
- Creating a common engineering environment
- Toolset
- Development procedures
- Quality process
- Motivation & morale
- Cross-company relationship building at every level
"Acquisitions make employees very nervous" Mr. Knight explained "People (rightly) think that the other company already has someone doing the same job as them. Having locked-in the tier-1 staff as a part of the acquisition, it is very important to tackle the morale issue immediately, or valuable tier-2 staff start shopping around."
Within 3 months, the companies' products had been loosely integrated, the teams were getting on well, and the acquisition was seen as a great success.
Mr. Knight has also been responsible for several other acquisitions during his career, all highly successful.