Setup Investment Co

[WilliamMGary]

Setup an Investment Corp to acquire equity stakes in other companies as a stock focused enterprise. Any company you want to merge with your operating/parent company merge them with the Investment Co first. By acquiring companies via your investment co you can make an organized integration into your operating/parent co by transferring firms one at a time. During this transition period the acquired company operations can still be on-going.

This is also a good way to identify assets you want and don't want which you can then put up for sale.

[Arcnor]

I like this. I'll have to give it a try during my next game.

[WilliamMGary]

Please let me know how this worked for you!

It was the coolest and smoothest way to handle M&A that I've ever experience in the game. I also recommend hiring a Retail skilled CEO they seem to be better then anyone else.

[Finn80]

This sounds like a very interesting idea that I would like to implement in my current game, however could you go into a little more detail...
1) By "investment Co." do you mean aquiring 51% stock in a holding company/subsidary to make stock purchases on a third company?
Parent Co.---->"Investment Co."--->Target Co.....?
2) I've run a few tests/experiments using the above M&A strategy, but I never had the option of transfering certain firms into my parent company. Its always been a merger and take control of all firms or nothing.....?

[anjali]

there are pros and contras to it

a big downside of it is that you have no control over stocks being sold in tender offers if you keep stock in another company then your head corporation, the ceo will just sell it if offered to and your ownership of companies you looking to aquire will drop instead of increase

i usually run it a little different.
once i got enough financial power, i start trading stocks with any left over, every single stock, buy low, sell high
all diversified/tech/investment/media companies i just buy n sell makes easily $500m+ a year
retailers and real estate corps i only buy and hold. especially retailers will early start to buy up their shares, taking them outa circulation, so if ya start too late you never get a 50% on them.
real estates are cheapest to buy as the shares are often playing rollercoaster so you can collct them if patient for 50% of their value and they got big real estates assets to loan out.
once i got 50.1% of one of the real estate corps, i staert playing the stocks with this company ... but only the buy/sell business. all companies i want to take, i keep buying with main corp only.
reason for that is, that i wont loose shares to tender offers as i just simply wont sell no matter what.
once i got the next real estate company in gonna merge them together by paying cash (take a loan for it, so you move the cash back into your main corp, enables you to buy more companies. let the real estate companies handle the leverage, as you hold their stocks, you still got the value and your own leverage you need to expand your business.
in the end i only gonna have 1 real estate company with a few billions leverage after merging all of them together

all retail companies gonna be merged into each other, and other businesses i merge depending on synergy.
in the diversified/tech companies, i use their leverage to build up the factories and shops to roll out their products across all towns. later move all factories and shops into main company after i build up a certain brand of my own if i havnt gotten it already.
without merging them its gonna be quite stressful having 8 or more companies as subs and to deal with everyone personally as the ceo's are jsut good to clean toilets and maybe price the goods, not letting them do anything else as it will make me thousand times more work to fix 5 times per month whatever they screw up and thats a ton of work by several hundred factories/shops. once i got 22 subs , thats way too many construction sites to deal with.

but most of the time i will merge them by paying cash, to remove share capital, as this is the most expansive working capital and with the years you have no idea what to do with all the cash sitting in the corner and being eaten by inflation. i never get to this point, most companies have loans and my main company has in the first years always an E/A ratio of 50% (later on its gonna be 30-40% as you just cant spend that much money anymore)

[Finn80]

Thanks for your advice, anjali, but it was the "Investment Co" that really caught my eye. I think that my current business model is going to work out and earn pretty good revenue through the first couple of years. So I'm looking to the future, and know that my business will, at some point, face some head to head competition or look to expand into product lines that other companies have a strong hold in. I would like to be in a position to execute a LBO, and absorb those other company's products and/or branding into my own operation.
A smooth seemless transistion is something i'm after....

By acquiring companies via your investment co you can make an organized integration into your operating/parent co by transferring firms one at a time.

Is this something that can be done without a mod or script?
If so....HOW?

[anjali]

By acquiring companies via your investment co you can make an organized integration into your operating/parent co by transferring firms one at a time.

Is this something that can be done without a mod or script?
If so....HOW?

of course can be done without mod/ script.
you see .. if you just merge a company you got 75% of their stocks into your main corp, you got your maincorp littered with all the crap and every firm has a tag on its name (merger 1) if its your first merger.

so in order to have a clean main corp, you start to restructure everything whilest its still a subsidiary but doesnt really need the investment co to do it. then just integrate the firms you want to keep, that way the firms keep the name you gave them without adding the stupid merger tag also you only need to keep an eye on those company for restructuring
if your main company is quite big, it would be a damn mess to merge a whole company into yours and try to sort the stuff out afterwards.

[WilliamMGary]

The Investment Co I setup as a subsidiary of the parent company and provide it with cash to invest in companies. It does require some micro-managing of investments because we don't have a CFO AI. Once I've identified a company that I want to merge with I provide the subsidiary co with the money it needs to acquire shares. I merge the company with the Investment Co, begin transferring the firms I want from the Investment Co to the Parent Company and either place the ones I don't want up for sale and/or close them.

This allowed for an orderly combination of two companies. It also allows the acquired company to still operate as an individual company during the transition.