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O Canada!(5) Strategies

The Canadian army won't be an obstacle

As we move beyond considering history to making it, I would like to thank all those who have written in with their comments, suggestions, quasi-serious jokes and trenchant observations. This strategic plan could not have moved to this stage without you.

Now then: Potential means of getting this transaction accomplished are various:

1. Friendly joint venture on synergistic operations. Attractive but limited in value. In such deals, each side keeps its brand, its independence, and its treasured access to key customers and businesses. Very little upside for the acquisitor and too much for the target.

2. Reverse takeover of U.S. corporation by Canada, Inc. Several of you have suggested this. It has its points. But the concept is ultimately unstable. We have a perfect example of such a maneuver: the Time-Warner/AOL merger. In that, a deluded CEO decided, in a so-smart-he's-stupid move, to allow his gigantic corporate government to be taken over by a smaller and less mature entity. In practice, it was like having a bunch of scruffy Visigoths taking over Rome, which didn't work very well the first time either.

3. Friendly merger of equals. Better, but still not perfect. A merger of equals is basically a polite term for an acquisition of one party by another in which the target retains much of its original structure. It would involve significant payment up front by the corporation, plus significant incentives to the target's senior management to remain in place, at least during an attenuated transition period. Integration issues would abound, and much of the existing, unnecessary infrastructure would have to be retained for an unacceptable amount of time. Friendly, merged entities give mergers and acquisitions a bad name, and the reputation for a high rate of failure that they enjoy.

4. Straight transaction. The 1971 suggestion that U.S. Corp simply buy out every Canadian citizen is amusing on its face, and would cost somewhat more now than it would have at that time, but it would guarantee a happy, affluent employee base in the newly unified entity. Such a buyout would create issues, however, with existing employees of the corporation, who, having joined from birth, essentially, would suddenly be thrust into the role of second-class citizens without the huge nest egg enjoyed by the acquired populace up North. Such resentments are difficult to manage. On the upside, a direct purchase of Canada from either its citizens or the United Kingdom, which reportedly has something to do with them, would ensure a free hand for those seeking to administer the transition and the shape of the new enterprise. Simple, clean, quick-- and very expensive.

5. Hostile takeover. Leverage their assets. Purchase them with the debt created by the deal itself. Enforce the new arrangement with force, if necessary. The reality is that the target cannot really claim the ability to defend itself. There would be minimal loss of life. The property, operations and employee base would be acquired. The small and rather limp national management structure would be phased out immediately. We could even offer attractive exit packages to those who wish to depart. After the dust settles, most would have stayed, and a plan for zero-based operations could be swiftly developed and executed. Marketing efforts could be implemented to develop new branding, flag, anthems, etc., for the entity. A new currency would be called for, which would be quite simple, exchange rates now being equal. Think of the excitement! The creativity that would be called for! The opportunities for growth and the development of new horizons!

Obviously, further study is necessary. Plans for this strategic initiative have been in development now for more than 200 years. It should not, however, take another 200 to get them field stripped and ready to go.

19 Comments Add Comment

Oh please no!!! It's nothing against the Canadians. I have worked with a number of them, and they are great people. Many of them are much smarter and more sophisticated than my clients in the US. I too pontificated about this wonderfull strategy after a 5th grade class on geography I believe. All the natural resources and land, very few people (that was my view then).

However, let's think about this: with their personal tax structure as hi as it is (at least what it was when I was working in Toronto), our desire to police the world, their desire to make sure everyone has healthcare, fixing their roads every spring (I can only assume it's similar to MN, WI, MA etc...), our politicians desires to cut taxes to get elected, and our current balance sheet. There is not enough oil up there to justify this strategy!

Bing,

Your analyses truly prove that, you failed your GMAT and the company which employs you for M&A activity wpuld have fared no better than Daimler Benz & Chrysler ;-)

News flash, Corporate America's Canadian takeover thwarted by Chinese white knight.

While you have been planing all this the Chinese have bought the U.S. lock stock and barrel and they did it with your own money.

When a big fish is about eat a small fish the big fish should always look behind for the bigger fish.

In case you didn't know, the chinese govt. has funded a private chinese/hongkong investor with 400 billion US, the plan is to buy US companies but never more than 50%.

let the Americans run the companies while they funnel the profits back to China.

Those profits will pay the pensions of the chinese.

So when the US worker goes to work he had better work hard cause now he has another family to feed.

Before you think of taking over Canada, better buy your own way out of slavery.

Lets face it, Americans like competition when there is no competition, and the Chinese have shown they can out Capitalize the capitalists.

We are in a changing world and it ain't all the great for the average working stiff in North America.

Thank god I'm at an age where all of this will unravel after I'm gone.

"Keep this world spinning till I get off."

Jack Hammond

As long as Maryjane is in the anthem!

To Steve,

Taxes in Canada are relative to what you are probably getting hit with in the U.S. In two provinces taxes are probably higher but if you live in NY or California it all balances out and you get health care. Won't both candidates for President be raising taxes if they are elected? Ironically Canadian taxes are dropping as the party in power got elected (just like republicans) by running on the "Low Taxes" platform.

Probably best just to think about this as a class project for future Hitler's that want to consolidate the world. Besides the last hostile takeover attempted by the U.S. failed... THE WAR OF 1812.

The war was an attempted carve out of what is presently Ontario and Quebec which were colonies of The U.K. This is actually quite similar in fact to the recent attempted "acquisition" of Yahoo Inc. by Microsoft Corp. whereby the acquirer would take the targets most strategic assets (search engine & ad network) and leave the unwanted remainder in the wake.

All acquisitions are acts of aggression, unless the entity to be acquired has put itself up for sale. And even then, it isn't the people of the acquired company who issue the call for interested parties -- it's the management. And it's usually the management of the party that's liquidated that does well for itself. The citizens of the old corporate state are usually found sitting with the short end of the stick poking them in the butts.

John Marc, I am very interested in the fact that you see the War of 1812 as one in which the United States was the aggressor. We are taught in school that it was an attempt by the British to re-subjugate our upstart nation.

Dear Bing Re the 1812 War. It a well known fact that American history books are full of crap just like the Russian ones.

Our history books are not full of crap but they do have a strange odor coming from them occasionaly.

In your books you still think you invented basket ball. We of course know better.

The Russians probably invented baseball for you too, but we let you have that one, cause you need something to be proud of.

CORRECTION Mr BING. Sorry but it seems the English invented Baseball. (Just read that on the net).
I'm sure you guys invented something just can't think of it right now.

Actually Mr. Hammond you are wrong. Baseball was invented by Alexander Cartwright in New York. He also started the very first baseball team, the New York Knickerbockers, not to be confused with the present time basketball team.

Sorry Mr. Josh
But according to the internet Base ball was invented 100 years before that in England and is documented as such in a personal diary and there are other written comments by others after and near that time to support that view.

Mr Nickerbocker popularized a game that aready been in play for nearly 100 years.

1. The friendly joint venture has been tried with the space shuttle program with demonstrably mediocre results. Canada contributed the shuttle’s arm and a few fellow space travelers but all Canadians got from it was dull TV interviews with local astronauts, and no idea what’s really going on up there.

2. The reverse takeover flies in the face of the laws of physics. A past king of England well described the circumstance referring to Scotland. “As in space, it is the smaller body that orbits the larger, not vice versa.” Canada is sort of the Scotland of North America.

3. A friendly merger of equals? A Canadian Prime Minister has already compared Canada and the USA sharing the same continent to a mouse sharing a bed with an elephant. When the elephant shifts, the mouse has to watch out.

4. A straight transaction has possibilities. The existing employees of the corporation merely need to contemplate that the moneys paid will all be spent at the company store quickly creating a bonus for all. No need for concern about the UK. They merely provide a profile for use on Canadian coins.

5. The hostile takeover, as tantalizing as it may sometimes appear, would create unfavorable P.R. for the larger corporation’s trademark. It would also disgruntle a large voting block accustomed to fielding four or five competing parties as opposed to a meager two. The resulting noise and confusion would be unbearable. Osmosis would be better than this.

Mr. Bing,

While your idea has merit, the presentation is insulting.

1. Canada has news. We invented the telephone, Blackberry and dozens of other technologies you take for granted. We have a wealth of natural resources including Gold, Oil and more Water than any other country on the planet.

Furthermore, there is no "The Canada Times" as illustrated in your video.

2. We have a healthcare system that works and serves the people. I can walk into any hospital and get treatment.

3. We're not greedy and didn't screw up our financial system as you have done.

Your arrogance is what will turn off most Canadians of such an idea.

Go back to the drawing board and develop a new strategy because insulting us will not work.

I love the idea of the U.S. of A taking over Canada. WHY can't we all just get along

The Americans system can not take over anything. They are allready owned by the chinese.

Lookup this date. August 24th 1812.

That was he last time a takeover was attempted.

Bing,

Responding to your Sept. 11 post...

I have dual citizenship (U.S. & Canada). I was taught in school, (having spent 9th & 10th grade in Atlanta, Ga. and 11th & 12th in Nova Scotia, Canada) history topics based on the selections made by Government run schools and have had to come to my own conclusions. Based on both U.S. & Canadian policy regarding naval blockades - which states that it is an act of war by which a belligerent prevents access to or departure from a defined part of the enemy’s coasts - the U.S. was in fact the aggressor against Canada by preventing British access to Canada's coastline and Canadian liner departures.

This is not unlike the U.S. blockade of Russian ships during the Cuban Missile Crises in which an accumulation of "Weapons of Mass Destruction" perhaps prevented all parties involved from firing upon one another. Ironically the selected topics of instruction given by both "Corporations" to me in grade school vary differently in their respective descriptions of the events. In this case I have concluded that this is a case of American propaganda and re-writing history after the fact.

Repling to Mr Hammond on the Baseball and History of America.

For one, who gives two shits about where baseball or basketball was invented. You didn't invent it so who cares. They both are American sports because I don't see the english playing them and if you would have read "Baseball" on wikipedia, Orgins of Baseball, first and last line. Thats where that good old American education comes into play. But like I said who cares.

Two, you say american history books are fully of "crap", ok, at least we have history in our books and I think they seperate them by what era the history took place. I don't think I ever saw era's on Wikipedia, or read a story about the canadians storming the beaches, or canada landing on the moon, or canadian military might and if there was it was because they were following the US military.

And for everyone else I applaud what ever inventions your country men created, but I am sorry you didn't know how to market it. Don't blame us for knowin what to do with it.

I am pissed off. Pissed about hearing everyone saying how bad America is but when all of you are in trouble who is there to help, AMERICA.

Now, I don't mind canada I think they are pretty smart not to get in anyone's buisness. I just mind ignorant people who talk crap about a country who cares more about the people in this world than any other country in this sorry world.

You do know that Quebec would likely come with Canada. They would attempt to negotiate their own deal which would grant them sovereignty and the right to self governance but would expect everyone else to pay for it...like Wall Street only a little more rude.

I do not see why it would be at all in the best interests of Canadians to have to take on the US debt and why Canadian people would want to become consumer serfs like Americans. I have traveled to Canada a number of times and too noticed that the news in the papers and to some extent on TV is much more innocent then in the US. To tell you the truth I thought it was good to see. The US systems relies more on fear, doubt, and greed to put Americans on emotional roller coaster rides to pump up ratings.

The best way for Americans to know what is better or worse is to travel and see for yourself. The knee jerk USA #1! or "love it or leave it" only shows ignorance. There are A LOT of pluses here, but we are not #1 in everything by a long shot. We should take the best ideas and practices from all over the world and stop keeping greed as our #1 virtue and excuse.

People seemed pretty friendly to me too in all of my trips to Canada.

Also, if we did merge with them then Canadians would be both respected, but also deeply despised by the majority of the planet.

If global warming is truly a problem. Canada might be a nice place to live down the road. Too darn cold now though. Of course I could also do the snow bird thing. ;-)

BTW, if the US does implode we will take down Canada too, and Europe, and Asia.....we are already merged!

Thanks for reading my opinion on the matter.

All your speculation is useless. Respect us as a sovereign country and we will be friendly. Fuck us up with too much American ownership and we will be a huge problem for you. Not militarily but we are connected with the world. We will remain Canadian and sovereign. To shut us up you would have to kill us all. You are not our only ally. Lets keep things friendly.

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