Bing Blog

The next big acquisition, Pt. 1

Canada

Summer is right around the corner, bringing with it the smell of seersucker and a big spasm of strategic planning. I'm sure that many of you are involved right now in exercises that scope out the shape of the third and fourth quarters and, more importantly, take a look going forward at what next year and the year after might bring in terms of credible claims that could boost your stock price.  

In so doing, it is altogether proper, of course, to consider whether one's corporation is working with the proper mix of assets. Divestitures of non-core holdings are considered, as are strategic acquisitions both friendly and unfriendly. In that latter regard, it is quite clear that friendly transactions are best, yielding true economies of scale, collegial consideration of key integration issues and so forth.

Still, unfriendly actions against target companies are sometimes necessary, and those are on the table as well, as we take a look at the challenges and opportunities that lie ahead. These questions are appropriate not only to business organizations, but also to those meta-corporate structures known as nations, although we might all be better off, globally as well as locally, if the leaders of our national governments were as rigorous and methodical as those in our arena. Too often, governments rampage about willy-nilly doing whatever feels best when party politics, anger, greed or emotions of one kind or another take control of the ruling cadre. 

Our governments could, in short, be more businesslike. This is particularly germane at this moment, as each party nominates the individual it believes would be best-suited to represent the interests of the American people. Is this not an excellent time to take stock of our portfolio of assets and look for ways to divest, invest and grow the base business of our national corporate state? I believe it is. The scent of change is in the air, and in that environment in which fresh ideas are not only welcome but necessary I have a suggestion for a very, very big deal that could solve a lot of our strategic issues and point us in a good direction for many years to come. I'll lay out the rationale in the next few days, as well as some suggestions for how it might be accomplished under a number of possible scenarios. In so doing, I will simply be bringing some of the methodologies I have learned over my years in business to some of the issues that face our nation. Longtime readers will know I have looked at this issue before. Nothing was done at that time. The idea is no worse now. In fact, with Europe melting down it may be more germane -- not German! -- than ever before. 

The concept is this: When viewed as a business entity, the United States faces many of the same problems endemic to mature organizations. Growth has slowed. Upside is difficult to ascertain given the current asset base. Operating resources are suddenly quite limited. Wages are higher than many competitors. At the same time, opportunities for young people are narrowing. We are increasingly less competitive with start-ups that promise adventure, better benefits, more leisure time, and a stronger currency more likely to grow over time, like Europe, Asia and Dubai. At the same time, make no mistake, our corporate state is strong. With an influx of new blood, new resources, new territory, the powerful established base could be sustained and produce a radical new growth curve. In short, a major acquisition is called for.

Recognizing this, the prior Administration to the current one attempted tuck-in acquisitions that have failed to produce value and in certain cases required hostilities that were most counter-productive. Current activities have been non-strategic, far-afield, alienated from our core operations and difficult to manage, to say the least. It is clear to many that these abortive efforts - be they joint ventures or ill-advised mergers of one sort or another - have failed, and must be abandoned. The problems inherent in a static strategy, however, remain.

And yet the answer is staring us in the face, I think. When the United States faced a similar dilemma in the 19th Century, it expanded corporate operations until they reached from one end of the continent to the other. It was, of course, a rough-and-tumble time, not as sophisticated and evolved as ours. The process was ugly, even if it was given a clever brand to hide behind. After all, one man's Manifest Destiny is another man's genocide, imperialism and theft of territory. Today, with our contemporary understanding of mergers and acquisitions, product and brand integration and organizational theory, there is no reason why the process could not be done quickly, efficiently and in a highly civilized manner, producing value for all concerned. This is why I believe the time is right for the United States to acquire Canada.

I will pursue this timely idea in subsequent postings. Stay tuned.

22 Comments Add Comment

Haha! I laughed out so loud when I got to the end of that one.

If the US were to 'acquire' Canada, I, as well as the vast majority of the wealth and talent would likely elect to leave. With the exception of your military, what does the US have to offer besides excess population and debt?

Evidently, your internal controls are a little out of line, no?

Great idea, Bing.

Vertical Integration. What have we been buying from them? I think we're the largest consumers of Cold Canadian Air Masses. This could dramatically lower our operating costs. Go ahead and put together some cost-benefit analysis for the next budget review. Let's see how many Loonies we're talking here. Call Mexico and see if we can unload Canada's pesky French division if the deal goes through, but see if we can keep Bombarier.

Dear Canada,

You should want this merger. That way your families that are seperated because the smart ones moved south long ago can be re-united!

The US offers only one real thing: opportunity. How you get rich is your own damn business!

RE: "With the exception of your military, what does the US have to offer besides excess population and debt?"

Lord Stanley's Cup.

I can't wait for tomorrow's article. The ending was hilarious. I am a dual Canadian, US citizen and can only say that the biggest benefit might be merging the NFL with the CFL. I wonder if the oil sands and the eventual oil shale (in the US) will support our combined consumption. What about taxes. It is cheaper to make money as a company in Vancouver & Calgary than almost anywhere in the US and I don't have to worry about my employees health care or my own for that matter. Government handouts are plenty up here and the investigative reporters in the US might have a problem with fisherman making $6 figures for working a couple months and taking unemployment for the rest of the year. Also who is going to be in charge of the budget? Canadians are not in the habit of living off credit like in the US. There is going to be a big change in the percentage of Democrats (and I mean left wing nut jobs) and Left leaning Centrists. Canada also has it's own Alabama called Newfoundland and it will become the new butt of the country. HAHA please hurry on the article.

Bing,
The better idea would be for the U.S. to acquire Mexico. That way your problem with illegal aliens from south of the border would be solved. No need to erect that costly fence anymore.

Bing you have just made my arguement for Canada to go nuclear to protect my nation from just such events.
We like Americans we deal with them, we visit them, trade with them; but we sure as hell don't want to become one.

Our political system is already run by buffoons and the mentally retarded, I don't need to wake up in the morning to listen to a new idiot with a Georgia twang.

Why don't you join Mexico instead they are almost all living in your country right now anyhow.

We should take Mexico instead (we've already beaten them a couple times, so it won't be new or anything). Lots of people are upset over the illegal immigration thing, but if we took that one, they would all be citizens. They have proven and drillable oil, precious stones, gold, land and people. Not to mention the food is quite good - way better than fries and gravy.

Well !! I d'ont think you have enough money to buy this contry . May be if you invade Canada by force, it's another story .You should rent the movie "canadian bacon" (1995) directed by Michael Moore ??? (strange)? it may help you. And stop the gre... taba.. it's not legal in your country. See you!

Why not the other way round, US is ripe for acquisition? Look at it this way, You are past the prime, and reached a plateau, what you need is fresh thinking, and lot of globalization...i.e. ready for acquistion. I am sure the PE ratio will also be favourable especially taking all the debt into considertaion etc.,

A country that can muster the expertise to brew "CROWN ROYAL" and "CANADIAN MIST" would be great to integrate with "JACK DANIELS" and "JIM BEAM".

Umm, Bing

The phrase you and what army comes to mind.

Unfortunately, your army is bogged down in Iraq, a country that really does not want them there. (kind of like us in Afghanistan)

By the time the US extracts its armed forces from Iraq, they will have most of thier offensive ability destroyed. Granted they will still have the ability to defend America but no longer the ability to take the fight to another country.

I look forward to tomorrow's article.

I'm like John P as I was born outside of Toronto. I like keeping both of them seperate however I'm sure most Candians and French Candians will agree that the US can have Quebec. East Montreal(all french speaking) would good great with the Statue of Liberty.

Good idea. Canada is the single largest source of foreign oil imported into the US (between 18-20% fluxuation monthly).

By adding Canada to our portfolio we can greatly reduce the overhead of Crude Oil acquisition. Not to mention all the other natural resources like beer, timber and French-Canadians.

To the contrary, I think if you exam the balance sheet of the 2 countries, I think the US indebtedness would be a liability to Canada. Canada should first let the US go into Chapter 11 and then strip the assets.

What an interesting idea. Lets explore this a little further. You are ready have some of our best exports, like hockey players, Molson American, oil at a fraction of the price and Jim Carrey. The only thing we really import are football players cut from the NFL. The Trudeau experiment in multiculturalism is over. The French continue to hold us hostage with their threat of separation and no Federal Government stands up to them or any other minority (yep we're sorry). Already there are more economic ties north-south than there is east-west. And someone suggested Mexico too. The United States of CanaMex. And heck, why stop there. It would be a lot cheaper to build a fence at the Panama Canal since it would be really short and you are there already. Only thing is it is starting to creep me out with echoes of the book 1984. Tea anyone??? I still think there is some at the bottom of the harbour in Boston.

What a funny article! Aquisition of Canada...like they would be interested in us! Why didn't we think of teaming up with them back in the 80's or early 90's when we had more negoitation power ($)! I'm not too sure that it's a good idea asking your friendly neihbor that watched you over develop your territory and lose your "house" because of it, if they can team up with you to ride the bad times out with you until WE make things better.How bad is the economy really,to think that we need to look ouside our borders for additional Govermental financing.What a funny article!

Your're an asshole buddy. There's a reason that "nothings going on here." It's because thats how we like it. Canada is not here for a so-called acquisition. The U.S. made its bed. Jeff, Canada

Unfortunately, in Canada we see the American populace as increasingly fat, uneducated and greedy. It is only a matter of time before you become an option within our portfolio...so thanks for the consideration, but we are already looking over your corpus.

By the way, are you really serious about considering the Sarah Palin and John McCain's of the world to lead a nation already nearing cardiac arrest...we watch on with amusement, and at times sadness of a friend with terminal illness.

Bing,

In Canada we dream of the day where we can drive down a freeway and see the same shopping centers every 20 miles (30km) or so. We are already working towards this, so a merger only makes sense. We are, however, plagued by a lack of cheap labor to get this done. Maybe you could advance us some illegal immigrants? I've heard there are a few.

Fiscally, with all the money from selling Quebec, we could start a movement to legalize the green crop in BC. The revenues would be so tremendous we could pay down that pesky debt.

Rather than giving us each $1M, just pay us a royalty on water that we can ship south to the thirsty states. We can spend those cheques every month at a shiny new native American tribal casino...? Sounds good to me.

This idea is certainly a winner but it will be a tough sell. Good luck with the negotiations.

Hey, you already tried that in 1812 and got your ass kicked. Haven't you heard Burton Cummings (of the "Guess Who") sing American Woman? What part didn't you understand?
Besides .... Canada doesn't need 51 more provinces.

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