Thoughtline may 2009 - the banking & financial services e-newsletter from wipro

MAY 2009

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ethe Banking & Financial Services -newsletter from Wipro Technologies

Volume VII Edition XVII

the Banking & Financial Services -newsletter from Wipro Technologies e

Feedback & Suggestions aremost welcome. Please email to

[email protected]

Editorial Team

Rohini SawantNaina Gupta

Volume VII Edition XVII

Index

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2the Banking & Financial Services -newsletter from Wipro Technologiese

For Wipro internal circulation only

..................................................................................................� Foreword

?Know Your Domain Terms..........................................................................

?Demystification

?Account Watch

?Market Watch

?Fun Corner................................................................................................

?Raja Ravivarma.........................................................................................

3

4

- The 'Cross Wind' In Mergers and Acquisitions...... ...........................................5

- Data Protection during M&A – DLP a solution.............................................7

- Bank Holding Companies: Current relevance and the buzz about new

financial entities .....................................................................................9

- Before closing the deal: Take a stock of your IP inventory 12

“Mergers & Acquisitions in financial organizations” : Lloyds HBOS Merger

Challenges faced during the M&A phase 14

- Integration Approach and Impact of Three Major M&A Deals in the US

Banking World.......................................................................................17

- The M&A Management Tools Market 2009 19

21

22

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Foreword

Warm Greetings!Understanding the key M&A trends in the financial services sector is of critical importance to all players in the

space and, given the turmoil experienced at the end of 2008, this has never been more important. It was the

decision in September by the US government to allow Lehman Brothers to fail that was the turning point in the

ongoing crisis. At first it appeared that the financial community would take care of its own. However, Lehman's

collapse precipitated a knock-on effect and, as a result, governments were forced to step in to bolster the ailing

system.

Overall deal activity in Asia Pacific fell through 2008, as the financial crisis restricted the willingness and ability of

financial services players to look to M&A opportunities. Activity in Europe and North America dominated in each

quarter, peaking in Q4 with a rush of rights issues and hastily arranged acquisitions of collapsing banks.

We decided to put the action in a perspective by presenting the May 2009, Thoughtline theme as, “Mergers &

Acquisitions in financial organizations and rise in Bank Holding Companies". We, the editors played host to our

agile contributors who took the centre stage to share a bevy of topics on this platform. In an effort to simulate

the action, we launch you on the battle ground after equipping you with some domain terms to start with. Then

we have authors who will lead you to the board room to take some quick lessons on the M&A strategy of

challenges to expect in the event of locking a deal and safe guarding the treasures of data in an organization.

While some of them will give you a demonstration on the usage of the available tools to facilitate closing a deal

and examining a basic kit to do the intellectual property due diligence. Meanwhile we have some others busy in

getting the right advisors to the discussion table to act as catalyst to the deal at hand. As the battle lines are

drawn we have a few authors who will help capture the action of the mighty wars of the past for us. Finally, with

your armor on we also want to get you under your thinking hat as you get set to take a shot at the- quiz- target.

We are waiting to count the arrows on the target!

Like wise from the hushed whisper in the board rooms to the broadcast in the media, we help you meet a

complete circle on the selected theme. We are thankful to the contributing authors who managed to spare a

thought and an hour amidst their delivery deadlines to help us compile this edition. Also a note of thanks to the

design team for crafting the edition tastefully.

With each article presenting a wealth of knowledge and insights on the topic we are sure this edition will prove

to be worthy of your time spent on it.

Best wishes!

The Thoughtline editorial teamRohini Sawant

Naina Gupta

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The Wipro editorial team compiles this newsletter with contributions from Wipro's staff members. The views and opinions expressed in the articles / other contributions by individuals are strictly those of the authors. The content of these articles has not been reviewed or approved by Wipro.

Parts of the Images used in this Thought Line is reproductions ofRavivarma's Painting's

the Banking & Financial Services -newsletter from Wipro Technologiese

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4

Naina Gupta


Acquisition

Amalgamation

Capitalization Ratio

Circular merger

Defensive merger

The purchase of the controlling interest or ownership of another company. This can be affected by:?Agreement with the persons having majority of

the stake ?Purchase of shares in the open market ?To make takeover offer to the general body of

share holders ?Purchased of new shares by private treaty ?Acquisition of share capital

It is blending of two or more companies. The shareholders of each company would become the shareholders of the company which is undertaking the activity. It is similar to a merger. Acquiree, Transferee, Victim, Offeree, Target Company: The company which is being merged or taken over by the other company.

Measurement of the company's debt component of the company's capitalization. Measures the extent of debt used in relation to the company's permanent capital. Determined by dividing long-term debt by long-term debt plus equity

Companies producing distinct products seek amalgamation to share common distribution and research facil it ies and promoting market enlargement. The acquiring company benefits by economies of resource sharing and diversification.

The directors of a threatened company may acquire another company for shares as a defensive measure

to forestall the unwelcome takeover bid. For this purpose, they put large block of shares of their own company in the hands of shareholders of friendly company to make their own company least attractive for takeover bid.

A document required by the SEC to announce certain significant changes in a public company, such as a merger or acquisition, a name or address change, bankruptcy, change of auditors, or any other information which a potential investor ought to know about.

A corporation that owns enough voting stock in another firm to control management and operations by influencing or electing its board of directors.

Merger is the fusion of two or more companies (OR) Merger is a combination of two or more companies into a single company where, it survives and others loose the corporate identity. The survivor acquires the assets and liabilities of the rest.

Reverse Take-Over. When a company buys out a larger company, but could also occasionally refer to a private company taking over a publicly listed company. Typically, a public company that is taken over by a private company will remain listed, and the private company will use the acquisition as means of gaining a listing. A reverse take-over is a relatively rare event.

It is a kind of a de-merger where an existing parent company distributes on a pro-rata basis all the shares it owns in a controlled subsidiary to its own

Form 8-K

Holding company

Merger

RTO

Spin Off

Know Your Domain Terms

shareholders by which it gains effect to make two of the one company or corporation. There is no money transaction, subsidiary's assets are not valued, and transaction is not treated as stock dividend and tax free exchange. Both the companies exist and carry on business. It does not alter ownership proportion in any company.

Galaxy of Musicians


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The 'Cross Wind' In Mergers and AcquisitionsVinodh Ravishankar

C

The legal, financial and IT tangle

ompanies gunning to increase their business scale, add new products, or become more cost-efficient often rely on mergers and acquisitions as a quick

route toward those goals. M&A by design is a corporate or organizational strategy to buy or sell a business entity for the purpose of accelerating growth and profitability. M&A is a common form of inorganic growth strategy fraught with a multitude of challenges all along the way.

Information technology is a cog in the wheel for all modern business processes. Integrating the numerous, complex and critical information and control systems is one of the biggest merger challenges. Often, one of the merged businesses is a division of a larger whole, and so it will not be able to continue to operate after closing without ongoing access to the vendor's systems. The nature and scope of these IT system dependencies should be mapped out early and documented well. The vendor and the purchaser must agree on the disentangling of the IT assets and their apportionment between the purchased business and the seller. Some systems are highly strategic and might have served as a strong motivation for the acquisition.

Successful mergers and acquisitions rely on information technology to achieve their aims. It is critical that the IT infrastructure, processes, and strategies of the two companies be united. All too often in the M&A world, IT integration is incomplete, delayed, and costly, and this can frustrate business goals and undermine the success of a merger.

M&A is a difficult transition process for both management of the acquired organization as well as the management of the acquiring organization. In an M&A process, not only does management merge systems but also a lot of associated

Demystification

M&A by design is a corporate or organizational strategy to buy or sell a business entity for the purpose of accelerating growth and profitability.

elements. Management of the acquiring organization must merge systems, cultures, values, principles, policies, standards, procedures, morale, and many others. The financial management systems as well as the financial information systems of the acquired organization must be merged into the acquiring organization. In addition to the financial information systems, communication and human resource systems must be merged. Merging these systems is usually hindered by system incompatibility, technological issues, lack of expertise, timing of the merger, financial issues, and managerial non competence.

Furthermore, besides the difficulty in determining systems compatibility and the expertise to integrate both systems, acquisition price increase is another financial challenge that the management of the acquiring organization must deal with. It is evident that management of the acquiring organization must resolve systems integration issues in the planning stages of M&A before advancing to the final stage of the acquisition process. Each organization uses its own technology and has crafted its own infrastructure, with distinct operating costs. Bringing them together entails additive costs, and integrating them would geometrically increase complexity.


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Demystification

The probability of a successful IT integration in M&A grows strongly with the effort on assessing the current IT environment, making necessary improvements, training staff to handle integration efforts, and developing integration principles and templates for due diligence and planning. Poor documentation of systems, a lack of metadata, diverse uncontrolled data sources and poor data quality are significant hurdles in the integration process.

M&A orchestration presents legal challenges in the form of deal structuring, valuation and regulatory issues. Valuation roadblocks stem from the fact that volatile projected earnings and asset values are moving targets to grapple with. Regulatory issues typically involve a violation of government regulations. One important regulation that must be met involves antitrust and monopoly legislation. A merger or acquisition must not significantly affect the role of competition in the specific industry to ensure that the resulting company does not have a monopoly in its industry.

The merged organization focuses at first on strategy, profitability, technology transfer, structure and administrative issues. There is an over-reliance on the control and management of information, while lesser attention is paid to realizing the full organizational potential. Priority is set to a lower level for sensitive integration or assimilation of cultures, and on development of human potential. In the first awkward months turf issues and inclusion and exclusion fears predominate among the two cultures, and these are seldom given the required care. In the unfamiliar setting people do not learn to dialogue in a way that inspires trust, and they fail to disseminate vital and timely information for problem solving and the generation of major improvements in productivity and profitability.

The human angle

A critical problem to overcome is the lack of cooperation that stems from uncertainty and insecurity. When companies merge there is a clash of cultures, conflicting beliefs, and different norms. When employees know that the work environment has changed, but are uncertain about the new rules and guidelines for personal success, they become defensive. Thus individual employees, regional teams, and sub-divisions of the organization strive to "look good" at any expense for the sole purpose of survival and self-preservation.

The human resource issues in mergers and acquisitions (M&A) can be classified into two phases viz., the pre-merger phase and the post merger phase. Due diligence is important in the first phase while integration issues take the front seat in the latter. The pre acquisition period involves an assessment of the cultural and organizational differences, which will include the organizational cultures, role of leaders in the organization, life cycle of the organization, and the management styles. The usual impact is high turnover, decrease in morale, motivation and productivity, leading to a merger failure. The other issues in the M&A activity are changes in the HR policies, downsizing, layoffs, survivor syndromes, stress on the workers, information system issues etc. The human resource system issues that become important in M&A activity are human resource planning, compensation selection and turnover, performance appraisal system, employee development and employee relations.

The uncertainty during the M&A activity divert the focus of employees from productive work to issues like job security, changes in designation, career path, working in new departments and fear of working with new teams. The M&A activity leads to duplication of certain departments, hence the excess manpower at times needs to be downsized hence the first set of thoughts that occur in the minds of employees are related to security of their jobs.

The road blocks in a merger or acquisition process are not insurmountable. Clear road maps for system integration, comprehensive due diligence on legal and regulatory compliance, open and timely communication from senior leadership would prevent surprises late in the game. A tight alignment between strategic imperatives and operational planning of the process would alleviate the issues to a great degree.

Palliation

The probability of a successful IT integration in M&A grows strongly with the effort on assessing the current IT environment, making necessary improvements, training staff to handle integration efforts, and developing integration principles and templates for due diligence and planning.

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7

Data Protection during M&A – DLP a solutionArun Vbhaskar

In the Current crisis scenario of economic downturn, recession swept over by strong winds of mergers and acquisitions specifically in the financial sectors

where weaker banks are snapped up by larger ones. Almost all financial organizations retain massive amount of regulated and sensitive data. In order to secure their investments the purchasing organizations must quickly take inventory of the acquired company's information assets and should track the details like where the data are stored, the personals that have access to them and how secure are they. However in this 'Melting' economy, where companies are sold off very cheaply with little time for due diligence, makes it difficult for the acquiring companies to control and take an inventory of physical assets such as phones, VoIP's and computers, let alone understand what's happening to any sensitive data. This particular scenario raises few questions in the minds of the investors. For instance, how the data is being protected as it transfers ownership? , Who knows where the essential Information is located? Even leading up to the merger, how well-protected is information critical to the success of the deal?

All the above questions have one possible remedy, a well-crafted Data Loss Prevention (DLP) strategy. Financial institutions can take to protect their newly acquired data: by

Step 1) WHERE: Monitor business communications for sensitive dataStep 2) WHAT: Discover information assetsStep 3) HOW: Implement policy controls to secure sensitive data

In a typical M&A scenario, many employees and information owners will leave, move departments, or are made redundant. It would be necessary to find out who among the employees have copies of records (data) on their desktops and whether

those people are still with the company and where the IT assets are located. In a time of consolidation, employees with the access to confidential data may try to keep their customer contacts and info in personal Web-based email, or copy data to an external device. Therefore the very first step the acquiring company should take is to immediately begin monitoring business communication channels for sensitive data. And to achieve this quickly and effectively, Organizations should be equipped themselves with technology assets such as a DLP solution, encryption technology and rights management technology so they can immediately start to getting the visibility about the data.

The company can try finding out what's currently happening to confidential data as it moves about the company. For this they can monitor business communication channels for confidential data and one of the easiest ways to do this is with a DLP solution. This technology provides templates for hundreds of data types and regulations. For example, DLP technology can be used to find regulated information such as Gramm-Leach-Bliley Act (GLBA) and Sarbanes-Oxley Act (SOX) information, as well as customer data such as SSN and credit card information. In an M&A situation, a lot of confidential data is exchanged between law firms, auditors, human resources and more, and during an acquisition fear and uncertainty can lead good employees to make bad decisions.

Identifying good and the bad business processes early on will give organizations the astuteness necessary to better govern and secure the business by monitoring the communication channels to see where data is being sent and who is sending it. Most people think that they have to do a profound analysis on their data before they can monitor it. However, by using built-in policy templates in a DLP solution they can easily begin to monitor for the data they suspect they have, even before they know for sure that they do.

Data discovery provides an inventory of the data stored in an organization and can alert managers to data that is “at risk” of being lost. When data is discovered, one gains visibility into the organization's information assets and can begin to classify them. Through this process, one can improve both storage, security across the enterprise, can better plan for provisioning, access and growth (while at the same time mitigate risk).

Step 1) WHERE: Monitor business communications for sensitive data

Step 2) WHAT: Discover information assets

The company can try finding out what's currently happening to confidential data as it moves about the company. For this they can monitor business communication channels for confidential data and one of the easiest ways to do this is with a DLP solution.

Demystification

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8

Although most organizations can satisfy their discovery requirements by using the policy templates built into a DLP solution, the technology also provides for deep content inspection using digital fingerprinting technology. This capability permits the discovery of virtually any type of data, including proprietary information such as source code, merger and acquisition documents, and patent information.

After gaining visibility into what data an organization has and what data is being used, a DLP solution can institute controls to protect it. Setting policy controls around data, employees and communication channels allows organizations to send data wherever it needs to go, but safely. Communications during a merger and acquisition are critical, and data transfer should not be blocked under the right parameters.

For example, the legal teams for each party must be able to send information back and forth, but it's also important that those communications are secured. That's where DLP and encryption technology come into play. Setting policy controls can manage who can send what data, where they can send it and how it is sent. For example, in the attorney scenario, policies could be set to automatically encrypt e-mails between lawyers. Other examples of setting policy controls include fingerprinting data so that it can be sent securely in an e-mail. However, if someone tries to post it on a financial chat board, the policy would prevent it. The goal of policy controls is to secure data while at the same time enabling business.

On the whole Understanding the data that needs to be protected is perhaps the most critical aspect of any DLP solution. It's simply not enough to look at the 'wrapper' or format type, because data comes in so many different forms from excel file, presentation or database, to emails or instant message. The ability to accurately and intelligently identify the critical differences between, say; a confidential customer list and a shopping list, or tell if the data is source code or a merger document, is what makes content-aware DLP so strong.

Step 3) Implement policy controls to secure sensitive data

Although most organizations can satisfy their discovery requirements by using the policy templates built into a DLP solution, the technology also provides for deep content inspection using digital fingerprinting technology.

A DLP system that identifies what is confidential and accurately protects that data, means acquiring organizations can secure its investment early on, better understand the business it has acquired, and reduce risk.

Demystification

Shakuntala writing letter

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9Demystification

As a result of the global financial crisis of 2008, we have witnessed a lot of activities around financial entities and the buzz about Bank Holding Companies, also known as BHCs. The financial tsunami started with several bankruptcies, buy-outs, and government take-overs/mergers of many major financial institutions involving Bear Sterns, Fannie Mae, Freddie Mac, Merrill Lynch, Lehman Brothers, etc., the US government took actions to ensure that a bank holding company was no longer able to act as an investment bank. Bank holding companies were once again required to focus on banking activities. This has prompted and created new entities out of many traditional investment banks and finance corporations such as American Express, CIT Group, General Motors Acceptance Corporation, Goldman Sachs and Morgan Stanley that are moving to be converted into bank holding companies in order to gain access to liquidity and funding. This arrangement allows them access to the Federal Reserve's discount window and benefit from the Troubled Asset Relief Program, but the companies are now subject to increased regulation and examination by not only the SEC, but several other branches of the government and their ability to have exposure to risk will be limited. It makes it easier for the firm to raise capital than if it remained a traditional bank and can assume debt of shareholders on a tax free basis, borrow money, acquire other banks and non-bank entities more easily, and issue stock with greater ease. It also has a greater legal authority to repurchase its own stock once issued.

Bank Holding Companies: Current relevance and the buzz about new financial entitiesRajesh Stephen

Bank Holding Company is defined as a company that owns and/or controls one or more U.S. banks or one that owns, or has controlling interest in, one or more banks.

A Primer:It is imperative to understand the definitions of BHCs and related entities to understand the current environment surrounding the BHCs.

Bank Holding Company is defined as a company that owns and/or controls one

or more U.S. banks or one that owns, or has controlling interest in, one or more banks. A bank holding company may also own another bank holding company, which in turn owns or controls a bank; the company at the top of the ownership chain is called the top holder. The Board of Governors is responsible for regulating and supervising bank holding companies, even if the bank owned by the holding company is under the primary supervision of a different federal agency (OCC or FDIC). BHCs are also differentiated based on their size like the Large, Regional and Community BHCs. There also exists foreign banks generally referred to any U.S. operation of a banking organization headquartered outside the United States that are known as Foreign Banking Organizations (FBO) that can acquire or establish freestanding banks or bank holding companies in the United States. These entities are regulated and supervised as domestic institutions and Foreign Banking Organization of a BHC is a Foreign Banking Organization that is owned or controlled by a Bank Holding Company that also acts as a Bank Holding Company and is thus, supervised by the Board of Governors of the Federal Reserve.

Activities that Financial Holding Company can carry out include: insurance underwriting, securities dealing and underwriting, financial and investment advisory services, merchant banking, issuing or selling securitized interests in bank-eligible assets, and generally engaging in any non-banking activity authorized by the Bank Holding Company Act.

The Bank Holding Company Act sets standards for acquisitions and permits interstate acquisitions and nationwide branch banking. Although the act previously restricted bank holding company activities to those that are banking related, the Gramm-Leach-Bliley Act Of 1999 significantly widened the scope of authorized activities, allowing any well-capitalized bank holding company to

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10Demystification

become a Financial Holding Company providing a wide range of banking, investment advisory, and insurance-related services. Bank Holding Companies are often identifiable by the words banc or bancshares in the corporate name.

In 1970, the Bank Holding Company Act of 1956 was further amended to limit the business activities of a bank holding company to bank related activities only. However, in 1999, the Gramm-Leach-Bliley Act (i.e. Financial Service Modernization Act) deregulated bank holding companies. Under this act, a bank holding company could elect to become a financial holding company. Activities that they can carry out include: insurance underwriting, securities dealing and underwriting, financial and investment advisory services, merchant banking, issuing or selling securitized interests in bank-eligible assets, and generally engaging in any non-banking activity authorized by the Bank Holding Company Act. As a financial holding company, a bank holding company could also create an affiliate to handle investments and insurance services. The Federal Reserve Board is responsible for supervising the financial condition and activities of financial holding companies.

New or smaller banks often re-structure themselves into bank holding companies to take advantage of the greater financial flexibility this corporate and legal status permits. The downside includes responding to additional regulatory authorities, especially if there are more than 300 shareholders, at which point the bank holding company is forced to register with the Securities and Exchange Commission. There are also added expenses of operating with an extra layer of administration. The Federal Reserve Board of Governors, under Regulation Y has responsibility for regulating and supervising bank holding company activities, such as establishing capital standards, approving mergers and acquisitions and inspecting the operations of such companies. This authority applies even though a bank owned by a holding company may be under the primary supervision of the Comptroller of the Currency or the Federal Deposit Insurance Corporation.

The new entities have specific BHC commitments to adhere to, some of the key areas include Customer Relationship, Governance, Banking Operations, Controls, Credit Strategies and Reporting.

New Converts:

Customer Relationship:

Governance:

The financial companies who are converting themselves to Bank Holding Companies have planned their own strategic approaches to establish the banking business in order to build their liabilities business through launch/enhancement of online channels, proposed acquisition of regional banks, converting existing financial centers to bank branches, cross sell deposit products to existing client base, introduction of new deposit products, etc.

In order to achieve the above each of these new entities has specific BHC commitments to adhere to, some of the key areas include Customer Relationship, Governance, Banking Operations, Controls, Credit Strategies and Reporting. These new Bank Holding Companies have greater challenge to address each of these areas and have rigid timelines to comply with the guidelines. The Fed has said that the companies have two years to comply with the stricter regulations on bank holding companies, and it will allow extensions of a year at a time. This has pushed them to take advisory services from high end consulting firms to lay suitable frameworks and strategizing on implementations. While many of these entities have embarked on a journey to quickly adapt to the new environment but they are also depending and looking out for multiple partners to execute their planned strategies. The criticality of execution has become so important because there is a stringent need to re-impose faith in the financial system, government, share holders and above all customers. The business as usual for many of these financial entities has to carry on as they execute their plan to achieve the BHC status.

To sum up there are a certain set of core activities that the new BHCs are mandatorily looking into and a brief overview is provided below:

The new BHC has to deal with a new set of customer base that would be large in number, carrying out multiple transactions and having varying relationships. Hence the BHC needs to have sufficient infrastructure to hold customer data and relationships. BHCs are also appropriately laying out direct banking channel strategies that will help in enhancing their deposit business. In short, the customer experience and confidence is critical to attract and retain customers in the current environment.

This involves putting the basic organization structure in place in accordance with the BHC requirements. The activities that go along with it include developing a new management board structure, putting charters in place, training all members,

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11Demystification

preparing them to provide an understanding of the BHC and related regulatory requirements. It is essential to put training in place to ensure all employees are trained with respect to ethics, information privacy & security and making them aware of certain mandatory regulatory acts.

These are certain core basic operations to be put in place that are drivers to run the bank, for example: Payments business policies, procedures and controls, Enterprise technology relationship and configuration management, Operations policies and procedures, Document management including Imaging process, Global Liquidity Forecasting, Centralized cash management platform.

This involves all mandatory programs to control the operations of the bank and requires periodic review by senior management involving audit, risk and compliance teams in order to meet regulatory expectations. Some of the programs are implementing an internal Audit management system, Corporate crisis mgmt, Business continuity planning; implement frameworks related to Market, Operational and Liquidity risks, Compliance and risk management assessment program. Some examples of key ongoing business related compliance programs would be related to Payments Card Industry compliance, Identity management, Data loss prevention.

The credit strategy programs become all the more critical for these converted BHCs in the current financial environment. The overall bank strategy mandates activities like running the credit business in accordance with planned asset allocations, forming appropriate hierarchy in the organization to run the credit business with enhanced controls in place, devising an effective underwriting strategy, putting a consistent default management process, effective dashboards for senior management reviews related to exceptions and credit exposure, and the most important activity is formulating an efficient credit policy.

This is an enterprise wide horizontal activity and this mandates periodic information sharing with external regulators, senior management, customers and bank's internal users. This requires careful consideration when compared to the existing infrastructure; the bank needs to build enterprise data warehouse

Banking Operations:

Controls:

Credit Strategies:

Reporting:

capabilities upon the existing one, prepare to build effective customer information systems, realign their accounting packages, comply and track all regulatory reporting requirements, provide customers with consistent and accurate information, provide appropriate reporting contents to senior management and assist the bank employees with intelligent business information for effective sales and service delivery.

As these new and potential BHCs are gearing up to lay their respective roadmaps to re-design their organization structure and process, one can notice a lot of potential areas where IT can play a role to assist these organizations to build effective enterprise level frameworks and systems that will help them shape their business, gain customer confidence, abide with regulatory norms and keep up with the competition.

www.ffiec.govwww.fdic.gov

Source:

Sahkuntala with priyamvada and anasuya

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12Demystification

Before closing the deal: Take a stock of your IP inventoryRohini Sawant

In 1997, small Texas companies called DataTreasury invented and patented a novel technology to electronically capture and store checks. More than 10 years later, post 9/11, laws were instituted requiring banks to be less reliant on paper checks. DataTreasury found that its patent was being used by a long list of major American banks. Most of the banks were not paying any licensing fees. DataTreasury filed a flurry of patent infringement lawsuits, prompting the banks to lobby the United States Congress to introduce an amendment that would allow financial institutions to infringe on the patent "in the best interest of American consumers."

Taking a stock of the companies Intellectual Property (IP) assets - patents, trademarks, copyrights, trade secrets/know-how, and agreements that affect IP - always provides benefits in the long run. And like wise this act should gain prime focus when the market spells a merger or an acquisition for a company. A comprehensive due diligence of its IP rights vouches to be a crucial ceremony to be performed before tying the knot. It must be borne in mind that a mere listing of the company's IP assets is not performing its due diligence. Rather, IP due diligence requires assessing the strength of the company's IP rights in the marketplace, the strength of the competitor's rights, and the effect of the IP on the base company's products and other IP rights.

Most of the times this activity yields to the business pressures of quick closing the deal at hand. And if done so, there could be some uninspected risky elements that could infiltrate with the deal. Hence a focused team of experts needs to police the IP elements of the company on a prioritized basis.

IP due diligence requires assessing the strength of the company's IP rights in the marketplace, the strength of the competitor's rights, and the effect of the IP on the base company's products and other IP rights.

The Basic kit for IP Due DiligenceThough every IP due diligence must be tailored to meet the particular business situation at hand, certain basic steps need to be considered:

1. List the Products and Services2. Identify related IP assets3. Prioritize analysis 4. Study the market for the specific industry5. Assess the protection provided by IP Assets6. Verify exploitability of IP Assets7. Conduct Non-Infringement Investigation8. Review Warranties and Indemnities9. Tag value to the IP

Now let us examine the kit at close quarters,List the Products and Services - The first step is to understand the company's basic products and services. This includes not only understanding the current product and service offerings of the business, but also projected products and services. The complete due diligence activity will be fueled by the knowledge acquired at this step.

Identify related IP assets - Another preliminary step in the due diligence process requires taking inventory of the company's intellectual property rights. The IP rights should be matched up with the product areas or business units, as appropriate.

Prioritize analysis - The third step in the IP due diligence is prioritizing the analysis. One possible prioritization is the understanding of mature versus emerging technologies, and focusing on certain forms of IP necessary to protect each one of them. A clear prioritization can set the right tempo for due diligence when the experts are hard pressed for time.

Study the market for the specific industry - One of the most important steps in

A clear prioritization can set the right tempo for due diligence when the experts are hard pressed for time.

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13Demystification

an IP due diligence is understanding the company's competition, both from a business and an IP perspective. One must assess the IP rights of the significant competitors as well as known patent holding entities. This includes a careful assessment of the competitor's patents, trademarks, copyrights to the best possible extent.

Assess the protection provided by IP Assets – The analysis done hitherto should help us in recognizing the scope of protection being provided by the IP assets that have been identified. Hence the outcome of this step will be the elicitation of some core areas where the company's IP assets are strong. Assessment can also delve into analyzing the license agreements that the company has entered into,

(a) To confirm that the rights will be transferable in light of the corporate structure changes, and to understand what procedural steps must be taken to have those rights transferred.

(b) To assess the impact of the change, in the corporate structure, on the licenses (e.g., due to a change in controlling interest in the company or the company becoming a subsidiary of another company).

Verify exploitability of IP Assets – Exploitability can be defined as verifying the ownership of each IP right and the validity of those rights. Special emphasis must be placed on the form of IP especially crucial to the specific aspect of a company's business (e.g., trade secrets may be the most important issue for particular emerging technologies). A further aspect of verifying exploitability involves assessing any on-going litigation in that company and making a reasoned determination of how that litigation will affect the IP rights at issue. Walking a few miles in this direction can help us in assessing the synergies with the buyer's business plans, which can include how to use the IP to create a barrier to entry for competitors in the marketplace, or at least placing a price premium for competitors to enter or remain in that market.

Conduct Non-Infringement Investigation – Once the exploitability factor is well defined we need to conduct an acid test of these IP assets to determine the company's freedom to operate in the market space. The IP strength gets rated here as stringent investigations for non-infringement are conducted. The associated risks like an IP getting invalidated, company's inadequate non infringement policies are to be seriously factored in such investigations.

Review Warranties and Indemnities - As a standard step in any due diligence, the warranties must be considered, along with some analysis of the strength of any indemnification agreements that may exist.

Tag value to the IP – The IP due diligence drill culminates with attaching a value tag to the IP assets. The value can directly affect the relative bargaining position in the transaction and may lead to requirements such as non-competition agreements from the seller in the transaction.

Whether performed with plenty of time to closing, or expedited by a pending closure, IP due diligence involves numerous factors that must be specifically tailored to the transaction at hand. Due care must be taken to execute the basic steps in a disciplined manner and at the same time fore sight should be maintained to recognize the point where to draw a tangent. Hence recognizing where deviation from the basic steps is required would depend on the sheer dynamics of the situation, there by making it a challenging task prior to closing the deal.

Conclusion

Thinking Lady

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“Mergers & Acquisitions in financial organizations”. Lloyds HBOS Merger - Challenges faced during the M&A phaseRakesh Krishnan

Mergers and acquisitions have become an increasingly common reality of organizational life. With the current economic climate, there is an

increasing emphasis on getting the M&A right and which serves the common interest of business, customer and shareholders.

Lloyds and HBOS merger (to be known as Lloyds Banking Group – LBG) is considered as a landmark deal for the financial services industry and a unique opportunity to create Britain's leading financial company and one of the largest in Europe. The merger has brought together two of the strongest and most efficient customer franchises in the country, providing an unrivalled distribution network to the benefit of customers.

The merger will also create a portfolio of strong and trusted brands and provide customers with access to a wide range of financial services products through a broad range of distribution channels. One of the reasons cited for this acquisition is that it gives Lloyds access to 20 million customers from HBOS, resulting in cross selling of the existing products.

However, the riding has not been smooth and it raises the question of what challenges did Lloyds face for such a high profile acquisition in terms of market, risk management, financial & regulatory and organizational aspects.

MarketEven without the merger of LTSB and HBOS, there have been questions raised

about competition in retail banking and whether consumers are getting a fair deal.

Does this merger create a 'super bank' which will breach the competition rules? With given economic scenario, it is clear that Government and the regulatory bodies have taken this as exception to the rule and in the safety of the business as a whole, approved the merger.

So what does it mean for the customer? It does call for restoring the confidence in the customers that their savings are safe and put right measures in place to discourage customer from withdrawing their money and institutional clients starting to move elsewhere.

The Financial Services C o m p e n s a t i o n S c h e m e (FSCS) provides limited protection to customers on t h e i r s a v i n g s a n d i n v e s t m e n t s . T h e k e y decision would be if a newly merged bank became just one authorised institution with the Financial Services Authority (FSA) which would result in savers being covered for the first £35,000, not more. However, if LBG goes ahead and retain their separate authorizations with the FSA post merger (as in the case of the RBS and the NatWest), the limit would go up to £70,000.

Banks are l ike ly to continue to be cautious about lending money to each other. As a result, mortgage

Lloyds and HBOS merger (to be known as Lloyds Banking Group – LBG) is considered as a landmark deal for the financial services industry and a unique opportunity to create Britain's leading financial company and one of the largest in Europe.

Account Watch

Lloyds Banking Group factsheet

? Formed on the 19th of January 2009 following the acquisition of HBOS plc

? Lloyds Banking Group is the largest retail bank in the UK

? With over 30 million customers, the new Group offers services through a number of well recognized brands, including Halifax, Lloyds TSB, C&G, Bank of Scotland, Scottish Widows and Clerical Medical

? Lloyds Banking Group has over 30 million individual and corporate customers

? In retail, the new Group is the UK's leading provider of current accounts, savings, personal loans, credit cards and mortgages

? Lloyds Banking Group Retail has the largest branch network in the UK, with approximately 3,000 branches, and one of the largest fee-free ATMs networks in the UK, with around 6,800 cash machines

? The new Group is a major bancassurance provider in the UK with a market share of 14 per cent.

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lenders will be more reliant on using money from savers to fund their lending. This reliance means high rates on offer to savers are unlikely to disappear any time soon, with banks and building societies coming under increasing pressure to get savers' money through their door.

As Lloyds and HBOS integrate their businesses, it provides them an opportunity to build one of the strongest banks in the world. Lloyds Banking Group (LBG) has clearly defined that they want “to be recognised as the best risk community in financial services by colleagues, competitors and external stakeholders.”

In order for the merger to be successful, LBG will have to consider the risk implications in terms of advising customers about appropriate products, considering how much to charge for a loan or deciding which company will deliver their supplies. Risk management is fundamental in delivering the confidence that LBG is a 'safe and sound' organisation. Till recently, Lloyds conservative approach (rated as Triple A bank) has helped them in current economic situation as it showed that they have suffered the least by having a lower volatility business model.

LBG has subscribed to the Asset Protection Scheme (APS) which will ensure that they will go for a reduced risk profile. Under the scheme, LBG will place approximately £250 billion worth of assets with effect from January 2009.

The regulators, central banks, and finance ministries will play increasingly important role for several reasons. First, there's a potential for significant consumer detriment if any bank were to go bankrupt, going by the example of Northern Rock. There's also the sudden need for banks to raise additional capital. And there are the liquidity markets, which are still seized up despite the efforts of the central banks, creating concerns about the real economy. Given following reasons, the regulators will be taking a keen interest in firms' business models and liquidity management.

Risk Management

Financial & Regulatory

LBG has subscribed to the Asset Protection Scheme (APS) which will ensure that they will go for a reduced risk profile. Under the scheme, LBG will place approximately £250 billion worth of assets with effect from January 2009.

The industry will hope that regulators don't do something inappropriate that will be difficult for the system to manage. There's certainly an awful lot of pressure for institutions to hold more capital. And that has been raised as a concern because Basel II is already pretty conservative, particularly the way it's being implemented in the U.K. With increasing pressure from the regulators to hold more capital and as credit becomes more expensive, it will have an obvious impact on the economy.

There is an expectation that Government will show more interest in bank operations, including how senior management is remunerated. There will also be less credit capacity available, which to some extent might turn out to be beneficial, given that there had been far too much credit available, and it was mis-priced.

Under APS, LBG has strengthened its capital Position by having a Core tier one ratio, which is expected to increase from 6.4% to 14.5%, a very strong ratio by any measure. With APS, balance sheet will be very considerably strengthened as we enter a highly uncertain period and with the downturn in the economy, well protected from future losses

Last but not the least, the 'super-bank' will throw up huge challenges in terms of merging two entities causing disruption ahead: such as branch closures, cull of call centres and other back-office arrangements. Defining how the target operating model look likes will be a huge task which LBG will have to go through to extract business & IT synergies.

The £12bn merger of banking giants Lloyds TSB and HBOS will lead to significant consolidation of IT systems across the two organisations. Synergies from the Lloyds/HBOS deal could be substantially higher than the £1bn suggested, possibly reaching as much as £1.8bn as the two banks cut overlapping operations and staff.

UK retail banking will be the area expected to see the most cost-cutting activity, with £790m of annual savings predicted. Among the measures the bank hopes will

Organisational Aspect (Business & IT Integration)

The £12bn merger of banking giants Lloyds TSB and HBOS will lead to significant consolidation of IT systems across the two organisations. Synergies from the Lloyds/HBOS deal could be substantially higher than the £1bn suggested, possibly reaching as much as £1.8bn as the two banks cut overlapping operations and staff.

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help it achieve its fat-trimming goal are "optimising the efficiency of the combined retail distribution infrastructure, including branch network, call centre operations and associated management and support functions" and "integrating the processing capabilities and information technology platforms of Lloyds TSB and HBOS".

Similar exercises across the insurance and investments arms, within wholesale and international banking and through the integration of central and support group functions will lead to a further £710 million in cost synergies. However, LBG will have to ensure that the process of consolidation has as little effect as possible on customer service.

The three year integration plan should broadly address the various streams of work which needs to be brought together right from Day 1 completion to 3-6 months of establishment and business delivery, 12 to 2 years of growth and market leadership and ending with “One Bank” concept at the end of three years.

We will have to wait and watch in terms of whether the integration proves one of the best moves taken by Lloyds TSB. There certainly is huge transfer of risk by bringing in £10 bn HBOS losses onto Lloyds book, but looking at the combination of Lloyds TSB, the Halifax and Bank of Scotland without any competition restrictions, it has catapulted LBG into being UK's biggest retail bank by far, all paid for by shares, not cash, towards the bottom of the recession cycle.

In any economic recovery, that will be a huge advantage, though resulting in high risk, and high return game for those who believe in the idea that opportunity knocks at the most inopportune times. Mother and child

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Integration Approach and Impact of Three Major M&A Deals in the US Banking WorldRam Lakshmanan

ackground: B

What was different this time?

The US Banking world was rearranged between August and October of 2008. Starting earlier in 2008 with the collapse and fire sale of Bear

Stearns to JP Morgan Chase, and Barclays' purchase of certain assets of Lehman, the US Banking landscape began changing. However, the most dramatic changes happened with three M&A deals in the Fall of 2008:

i. JPM Chase (JPMC) acquired Washington Mutual (WaMu)ii. Bank of America acquired Merrill Lynch andiii. Wells Fargo acquired Wachovia.

Out of all these six brands that are well known nationally and internationally, only three survived.

During normal times, banking M&A deals happen after a lot of study and due diligence into strategic drivers, synergies, and so on. This time around all the three deals were finalized under the gun and at short notice – the Fed was influencing and overseeing the deals even as the markets were watching nervously as to what was going to happen next.

WaMu could not survive the onslaught of credit losses arising from its MBS and CDO portfolios (Mortgage Backed Securities and Collateralized Debt Obligations), and declared bankruptcy. The Fed arranged an immediate sale to JPMC at fire-sale prices. Only about six months earlier, JPMC had offered to acquire WaMu at 8-10 times the price, but the WaMu Board of Directors had rebuffed the offer as being “too low”. JPMC with a fortress balance sheet was at the right place at the right time. Its calculated waiting with the attitude, “Why catch a falling sword?” paid off handsomely. For only $1.9 billion, JPMC got access to a network of popular WaMu bank branches and a 50% increase in its loan servicing portfolio.

Seeing the collapse of Bear Stearns and Lehman, Merrill Lynch – a huge dealer in MBS and CDOs – sold itself to Bank of America. The deal was arranged literally over a weekend with the Fed Chairman and the US Treasury Secretary brokering the deal between the two giants in order to prevent a collapse of Merrill and in the market confidence.

JPMC wanted to gain wider access to the West Coast US market for deposits and loans, and WaMu filled the bill. Bank of America wanted to expand further into the securities and capital markets and Merrill suited its needs. Wells Fargo wanted to expand further and saw Wachovia as an opportunity to achieve that.

JPMC+WaMu: Close on the heels of finalizing the deal to acquire WaMu, Chase took a series of strategic decisions and assembled a high-level team led by the CEO of Retail Financial Services to execute the integration of the two banks. The bias was to integrate WaMu into the existing Chase platforms and systems, unless there

Approach to Integration

The most dramatic changes happened with three M&A deals in the Fall of 2008: i. JPM Chase (JPMC) acquired Washington Mutual (WaMu)ii. Bank of America acquired Merrill Lynch andiii. Wells Fargo acquired Wachovia.Out of all these six brands that are well known nationally and internationally, only three survived.

Market Watch


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was a compelling reason to retain any of WaMu's systems. Another key decision was to integrate WaMu bank branches to look and feel like the Chase bank branches. Chase also moved quickly to integrate the two management organizations taking advantage of the best of talent available from both. Chase took the view that the existing staff at WaMu and Bear Stearns (which also brought EMC Mortgage to Chase) working with carefully selected Chase staff are best suited to handle the integration, as they had the most expertise in the existing platforms, processes and people. There is a lot of focus on managing WaMu's and EMC's risky assets through aggressive default management, somewhat liberal write downs, and multiple scenario planning. For the first time, two Chief Risk Officers have been appointed – one to focus on Default Management, and reporting into another for the lending business as a whole. Unity of purpose, command and direction was paramount in driving Chase's integration strategy.

Bank of America+Merrill Lynch: Quite unlike Chase, Bank of America went through a lot of turmoil in the early days of trying to pull together two diverse organizations and cultures. There was politics and bloodletting coupled with a power struggle among the senior executives of the two banks. John Thain, the CEO of Merrill, was the first to go. Recently Ken Lewis the Chairman was stripped of his position. Several teams are working on pulling the two financial institutions together. Strategic contours of the integration of Merrill and Bank of America still remain hazy. Besides, there is no clear strategy to deal with the toxic assets of Merrill and Countrywide that Bank of America acquired in end-2007. Bank of America has had a poor record of integrating systems and processes in its previous acquisitions.

Wells Fargo+Wachovia: Wells moved quickly to integrate the senior management predominantly putting its own team in charge of running the show.


Wells also has set aside substantial provisions for bad debt recognizing that the Wachovia loan portfolio carries a lot of unpredictable risks. Wells has set in motion integration of key platforms and processes to its proprietary suite. Thus we see a number of common threads between Chase's approach and Wells Fargo's approach to integration.

At a macroeconomic level, we foresee that these three major deals will lead to a more efficient utilization of capital. We also see an organized approach to cleaning up the toxic assets. As a result we anticipate that there will be greater wealth creation for the shareholders – more likely for the Chase and Wells shareholders given their approaches to integration. On the downside, we see continued job losses as six financial institutions (seven including Countrywide) become three. There is a general concern in the industry that as bank branches get consolidated, service levels may go down and customer costs of doing business may go up. Given the recessionary trends in the economy and the management maturity we see in these banks, we do not subscribe to that concern.

As technology platforms get consolidated, we see a greater drive towards looking for new ways to process deposits and loans. While the focus clearly will be on reducing the TCO (Total Cost of Ownership), we foresee the banks looking to create more synergies by making different systems talk to one another – e.g., integrate document management with loan processing and servicing systems; common and reusable data architecture at an enterprise level instead of at the LOB level; shared IT help desk services and server capacity and maintenance; cloud and mobile computing that does not create data security issues; and so on.

Economic, Business and Technology Impact

Market Watch

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The M&A Management Tools Market 2009Naina Gupta

Past 5 years have seen a spate of mergers in banking, insurance and wealth management across the world. Mergers and acquisitions (M&A) management tool providers are growing at rapid rates. This strong growth of M&A virtual deal room (VDR) and project management tool (PMT) providers will continue despite the current economic turmoil and fall in the M&A market. The market for such tools was $283 million in 2008 and will reach a total market size of nearly $1 billion by 2013. These tools will become an integral and essential part of a structured and systematic M&A process.

The dawn of the recession changed the face of M&A in 2008 with a decrease in global M&A activity of 30%. But that is not a threat to the M&A tool providers; it is rather an opportunity to highlight the potential benefits that they can offer firms conducting M&A in this uncertain environment. Key trends that M&A tool providers will encounter in 2009 include the following:

Global activity in M&A in terms of both deal value and deal number will fall in 2009. Focus will lie on divestitures, spin-offs, carve-outs, and business unit consolidations because corporations will seek to reorganize and restructure their business.

In particular, North American and Western European countries' M&A activity will be driven by cost reduction programs. Meanwhile, emerging countries — especially Brazil, Russia, India, and China (BRIC) — will continue to globalize inversely by more aggressively targeting cheaper assets in the advanced economies, which will lead in sum to higher outbound activities.

Changes in M&A activity lead to growing importance of M&A tools

?M& A activity will decline as the recession continues through 2009

?Cost reduction will be the primary driver for M&A in the advanced economies

?

The Current State of Adoption Indicates Growth Areas for M&A Management Tools

?Highest adoption of tools for large and mega deals

?Low to medium adoption for small and midsize deals

Consolidation will continue and extend well beyond the financial sector While the collapse in the financial and credit markets could generally be considered to lead to far fewer transactions within the financial sector, significant consolidation within the industry is almost certain to occur.

Leading analyst company Forrester compared the current adoption of M&A tools in relation to the size and number of all deals in 2008. The data indicates that the use of M&A tools is based on deal size rather than the size of the acquiring companies.

Following are the trends seen in growth areas for M&A management tools:Higher complexity of

deals typically leads to higher adoption. Large and mega deals have the highest adoption rate of dedicated M&A tools. 80% of deals of more than $1 billion to $10 billion use such tools, with this share rising to 90% of deals worth more than $10 billion. The additional complexity of such large deals and the clear possibilities of saving time, reducing costs, enhancing buyer intelligence and improving collaboration mean that the investment in such tools represents a rational decision

While large deals have high tool adoption rate, Forrester's research reveals that a significant proportion of M&A tool revenues come from smaller deals of less than $100 million. Thus tool providers must ensure that their offerings also meet the requirements of smaller deals in order to stay competitive and that they can easily illustrate business benefits to firms primarily conducting smaller transactions.

This strong growth of M&A virtual deal room (VDR) and project management tool (PMT) providers will continue despite the current economic turmoil and fall in the M&A market.

Market Watch

The additional complexity of such large deals and the clear possibilities of saving time, reducing costs, enhancing buyer intelligence and improving collaboration mean that the investment in such tools represents a rational decision

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The total M&A management tools market, including both VDRs and PMTs, will rise from $283 million in 2008 to close to $1 billion in 2013.

Market Watch

The M&A Management tools market in 2009

?

?PMT providers have experienced a lower growth rate

The M&A Management Tools Provider Landscape M&A Virtual deal room (VDR) providers

M&A Project management tool (PMT)

Forrester interviewed 17 providers of M&A management tools to size and forecast the market for M&A management tools. Their research revealed that:

VDRs have benefited from the increasing number of M&A deals over the past few years, particularly with the growth in cross-border and mega deals.

Since inception, PMT providers have experienced a slightly lower growth rate than their VDR counterparts. However, this also reflects the lower maturity of the market. On average, PMT providers also generate a smaller proportion of their revenues from M&A than their VDR counterparts, with an average of just fewer than 50% of their revenues coming from dedicated M&A engagements. Their pricing model is typically on a per-seat subscription basis, and their main competition is the continued use of in-house solutions as well as generic spreadsheet and project management tools.

VDR providers have had an average growth rate of more than 100%

The Global M&A Management Tools Market Will Reach Nearly $1 Billion By 2013Despite the uncertain economic outlook in many industries, M&A tool providers should gear up and prepare for significant growth in the next five years. The total M&A management tools market, including both VDRs and PMTs, will rise from $283 million in 2008 to close to $1 billion in 2013. The VDR market will increase from $263 million in 2008 to approximately $894 million in 2013. The market for PMTs will experience rapid adoption and growth, despite being worth significantly less than the market for VDRs. By 2013, the market will be worth $103 million, growing from $20 million in 2008; larger clients will be the main constituency. However, consultancies, legal firms, and banks will also be vital target audiences as they seek to more stringently and transparently manage pipelines and integration projects.

Sahkuntala Writing Letter

Fun CornerFun Corner

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Abhishek Gupta

Quiz

Rush your responses to: [email protected]

A. Match the Acquiring banks with Acquired Bank:

1. Travelers Group (1998) a. Bear Stearns2. Capital One Financial Corporation (2005) b. Merrill Lynch3. Bank of America (2005) c. First Charter Bank4. Bank of America (2007) d. Mellon Financial Corporation5. Bank of New York (2007) e. Wachovia6. J P Morgan Chase (2008) f. Citi Corp7. Bank of America (2008) g. Hibernia National Bank8. J P Morgan Chase (2008) h. Washington Mutual9. 5/3 Bank (2008) i. La Salle Bank10. Wells Fargo (2008) j. MBNA Corporation

B. When two companies create a third entity, and hence limits the overall risk of the transaction. This type of transaction is known as:

a. Mergerb. Acquisitionc. Divestitured. Joint Venture

C. Merger of firms operating in different types of business activities (no common business area) is known as:

a. Horizontal Mergerb. Vertical Mergerc. Conglomerate Mergerd. Financial Merger

D. Identify the type of acquisition when Company A acquires a local company B in China to gain a presence in China and be able to sell company A's products:

a. Geographic roll upb. Product Extensionc. Market Extensiond. Over Capacity

Acquiring Bank Acquired Bank

April Edition Quiz Answers1. systemic risk2. default risk3. 19724. Equity Risk, Interest rate Risk, Currency Risk, Commodity Risk5. risk of loss6. Pillar 1 - Minimum capital requirement,

Pillar 2 - Supervisory review process, Pillar 3 - Market Discipline

The winner for the March Thoughtline Edition is Joydeep DuttaThe winner for the March Thoughtline Edition is Joydeep Dutta

E. The process where a private company acquires a public company and bypass the lengthy process of coming up with IPO is known as __________________

F. The present value of a company's future cash flows from its existing assets and business is known as ___________________

Lady carrying fruits

Feedback &Suggestions aremost welcome.Please email to

[email protected]

Raja RavivarmaBy Channakeshava

Raja Ravi Varma was born at Ravi Varma Koil Thampuran of Kilimanoor palace in the erstwhile princely state of Travancore. His father Ezhumavail Neelakanthan Bhattatiripad was a great scholar and mother Umayamba Thampuratti (d.1886) was a poet and writer whose work Parvati Swayamvaram was published by Raja Ravi Varma after her death.

Raja Ravi Varma came to widespread acclaim after he won an award for an exhibition of his paintings at Vienna in 1873[2] . He travelled throughout India in search of subjects. He often modeledHindu Goddesses on South Indian women, whom he considered beautiful. Ravi Varma is particularly noted for his paintings depicting episodes from the story of Dushyanta and Shakuntala, andNala and Damayanti, from the Mahabharata. Ravi Varma's representation of mythological characters has become a part of the Indian imagination of the epics. He is often criticized for being too showy and sentimental in his style. However his work remains very popular in India.

Considering his vast contribution to Indian art, the Government of Kerala has instituted an award called Raja Ravi Varma Puraskaram, which is awarded every year to people who show excellence in the field of art and culture.

Prominent works of Ravi Varma are: Village Belle,Lady Lost in Thought, Damayanti Talking to a Swan, Arjuna and Subhadra, Lord Rama Conquers Varuna etc.

Designed by: [email protected]

Source: wikipedia

Hamsa Damayanti