Strategy Muse is intended to be a journal of strategies that businesses across the globe are currently employing to enhance income and/or control costs.
Balfour Beatty Plc, the U.K.'s largest house builder,
will buy the military housing unit of GMH Communities Trust, the U.S. provider of housing to students and the military for $350 million in cash as a springboard into other so-called public-private partnerships and related markets in the U.S. A public-private partnership, or PPP, is a government service or commercial business venture which is funded and operated through a partnership of government and one or more companies.
Can your business not create a unit for PPPs because the government can be a great source of revenue?
Fujifilm Holdings Corp.
agreed to buy Toyama Chemical Co. shares for 64.4 billion yen ($601 million) to gain control of a drugmaker that has about 10 medicines, including potentially a new treatment against avian influenza, the first new class of anti-flu drug in a decade. The deal may provide Toyama researchers with funds to discover new drugs after the company posted its biggest annual loss in at least 12 years. Fujifilm offered 39 percent more than the drugmaker's 631 yen closing price yesterday.
Is this not a vindication of going with the flow? What about the restrictive theory relating to core competency?
Bain Capital LLC
is willing to make concessions to win government approval for the $2.2 billion deal to acquire 3Com Corp. with China's Huawei Technologies Co., which has sparked national security concerns as U.S. lawmakers said the deal would put 3Com's anti-hacking software into Chinese hands - the Pentagon relies on 3Com's TippingPoint unit’s firewalls, which protect networks from attacks. Bain has submitted robust mitigation proposals that offer significant structural and security safeguards to American national security interests.
Isn't there an element of too much trust in such arrangements involving the security of agencies like the Pentagon? Will the profit motive breach the trust barrier?
Coca-Cola Amatil Ltd., Australia's largest maker of soft drinks,
is raising prices in its biggest market of Australia, adding new drinks such as Powerade Isotonic and expanding into alcohol by taking over the Australian distribution for Jim Beam bourbon and Absolut vodka and starting a joint venture with SABMiller Plc, which acquired Bluetongue Brewery Pty. and its Newcastle plant would complete a 50-million liter brewery in New South Wales state by 2010.
Warren Buffett's Omaha, Nebraska-based Berkshire Hathaway offered to shore up $800 billion of municipal bonds guaranteed by troubled MBIA Inc., Ambac Financial Group Inc. and FGIC Corp. in a bid to gain 33 percent of the debt insurance market. Berkshire Hathaway would assume the risk of the debt from MBIA and Ambac in exchange for charging a fee of $4.5 billion each.
CHASING AWAY EXPENSES:
General Motors Corp., the world's largest automaker,
will offer buyouts to UAW-member employees to speed the hiring of lower-paid new workers in the U.S. The offers would provide payments of as much as $62,500 for the most-skilled workers with at least 30 years service. UAW members with 10 or more years service can also opt for a one-time payment of $140,000 to leave the company and forgo future benefits. Workers with less than 10 years may take a $70,000 buyout. GM cut $9 billion from expenses from 2005 through 2007, and last year won a cost-saving contract with the UAW that will trim another $5 billion annually by 2011.
Do you have redundant staff? Have you checked? Do you check regularly? Provide them with alternatives before it gets too late for all.
Chrysler LLC is trying to emulate the efficiencies of Toyota. It will trim its 28 existing models to 16 and add new ones to fill existing gaps. It will eliminate models sold by one Chrysler brand that are basically clones of a car sold by a sister division so that it can put its marketing dollars behind one car in every market segment and create more noise with its advertising. It also wants to accelerate consolidation of the company's bloated dealer body, resulting in a smaller retail network that sells Chrysler, Dodge, and Jeep brands under the same roof. The moves come on the heels of two major restructuring moves announced by Chrysler in the last 12 months that cut more than 700,000 cars worth of production at several plants and took out about 23,000 jobs. But the plan also risks sacrificing market share and buyers as the company trims its offerings. Plus, getting dealers to buy one another could take years as the company will need to play matchmaker with buying and selling entrepreneurs.
A stitch in time saves nine+.