Helping public companies and their suppliers deliver better and more cost-effective programs since 1994

Reorg services

Here’s what we wrote in our 2007 issue on “Essential Tools”: “What a big boom there’s been of late in ‘corporate reorganizations’ and in other deals that are known as ‘reorg jobs’...like spin-offs, mergers and acquisitions, Dutch Auction Tenders and multi-billion dollar long-term stock- buyback programs.”

And now – wow – reorg-jobs are approaching all-time-high levels. And many of the biggest deals of all are international or even multi-national ones, which greatly adds to the complexities - and to the risks.

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Regular readers know we’ve been offering a lot of advice here too – which often produces amazingly large dollar savings. Here’s our advice in a nutshell:

(1) If you think you’ll be spending a six-figure number, all-in, go out for competitive bids. Your transfer agent normally enjoys a natural advantage here, but the TA of a company you are acquiring is often as good an option - and sometimes better – And sometimes (see points 5, 6 & 7) the TA is not a good choice at all.

(2) Be sure the RFP will allow you to carefully benchmark the out-of-pocket expenses - which tend to be very big ones where reorg jobs are concerned.

(3) Review the kinds of forms and other educational/informational materials the vendors have used in the past. Well-designed and well-written materials will save you a huge amount of personal aggravation, assure the deal goes through quickly and smoothly and will save a huge amount of expensive “clean-up work” later on.

(4) Do not forget to benchmark the brokerage commissions associated with many such jobs: The differences can be HUGE.

(5) Review the contracts and other legal agreements with special care: Every year we see some that try to limit the agents’ liabilities – because reorg jobs create big ones. But that’s why you hire an agent – and why you also need to be absolutely sure that any agent you hire has both the legal obligation and the financial ability to shoulder the risks, or they’ll end up as YOURS

(6) Make sure the agent you choose has very robust internal systems and controls in place...and

(7) Above all – as indicated in (5, 6 and 7) – be sure that the agent you select has the financial wherewithal to make-good on the monster-size mistakes that can and sometimes do arise in big reorg deals.

Laurel Hill

The Laurel Hill Advisory Group is North America’s only independent cross border Shareholder Communications Advisory Firm. When a response from a shareholder base is required -whether as simple as a routine meeting or as complex as a hostile take-over or addressing escheatment matters, Laurel Hill makes certain the required response is attained.

On both sides of the border we are regularly engaged in high profile, complex and contentious situations involving M&A, restructuring, and corporate governance issues, giving our clients first rate cross border capabilities that specialize in contested or annual meeting solicitation, information agent services, Mergers and Acquisitions, special meeting solicitation and shareholder asset recovery programs. We also provide Depository and Escrow services.

We believe that public issuers need to be proactive rather than reactive. If you agree, give us a call.

Independence | Experience | Results | www.laurelhill.com | (516) 933-3100

Mackenzie Partners

MacKenzie Partners, Inc. is a full-service proxy solicitation, investor relations and corporate governance consulting firm specializing in mergers-and-acquisitions related transactions.

We are called upon frequently to apply our expertise and capabilities in tender and exchange offers and proxy solicitations for clients who wish to have their investors or creditors participate in a restructuring of the company. This type of project also frequently involves the skills we employ in our securityholder identification and market surveillance work.

The 1980’s and the 1990’s generated companies that needed to be restructured and the lessons learned from those situations are being used to solve these new recent problems. This constantly evolving dynamic field requires a proxy solicitation firm at the forefront of these developments.

MacKenzie Partners has been involved in some of the most complex and difficult reorganizations over the past nine years. In our work in this area, we are utilized to solicit approvals for proposed or competing restructuring plans from one or more classes of creditors as well as security holders.

MacKenzie Partners Inc.
105 Madison Avenue
New York, NY 10016