Sale Of A Non Core Business
Some real world experiences
To manage the sale of an insurance business currently in run-off to a specialist buyer and complete the transition of technology, data, services, facilities and staff to the buyer while maintaining an uninterrupted business as usual operation.
The company, part of a global financial services group, had been put into run-off following an unsuccessful attempt to sell it as a going concern. The decision to sell had been made after a strategic decision by the group to withdraw from what it considered to be a non-core business.
A number of initiatives had been put in place to reduce costs and improve performance in line with the declining business. An on-going redundancy programme was in process, with every effort being made to redeploy staff or otherwise support them in finding alternative employment.
Reporting directly to the CEO, we were required to deliver a number of parallel work streams to tight commercial and regulatory deadlines, including the sale process itself, preparation of a corporate data archive, management of the internal and external communication programme, co-ordination of the hand-back of the company premises to the leaseholder and disengagement from the seller's group IT telecoms and disaster recovery arrangements.
On completion of the sale transaction we were retained by the buyer to manage the transition of staff, facilities, services and IT infrastructure to the buyer’s premises without disruption to the business-as-usual operation. The work was carried out within the terms of a formal Transition Services Agreement, with financial penalties attached for late delivery or non-compliance to the terms of the sale or regulatory obligations.
Both the sale and the transition were completed to the time and performance standards required by the buyer, the seller and the FSA. The assignment was a good example of how, with the right approach, even a change programme involving great uncertainty and where staff knew that many would lose their jobs, it is possible to achieve a successful outcome. In particular the lessons to be drawn from the assignment were these:
• Be open and honest with staff about the thinking behind the decision to sell the business;
• Maintain excellent channels of communication, both at team and individual level, throughout the change;
• Ensure that the selection process for staff who will be retained after the change is seen by all parties to be scrupulously fair. This will strengthen buy-in and on-going commitment;
• Provide real incentives, usually financial, to key staff to stay with the programme until completion and factor the costs into the sale;
• Set aside significant time and effort to help staff who will not be retained to find alternative work. Provide substantive support for this such as time off, use of a room with telephone and internet facilities for private use, help with CV preparation, contact local businesses, etc.
• Place risk management at the heart of the change. With so many variables that cannot be controlled with any degree of certainty, it is vital to prepare a thorough risk assessment and mitigation plan.
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