Author: activedirections

Meet David Royal

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David has a unique blend of corporate strategy, finance and executive management skills with over 25 years of international business experience. He is part of our Investor Readiness service and works with our clients regarding growth strategies, investment cases and advising on joint ventures, mergers and acquisitions.

David is passionate about drawing on his experience to advise businesses and help them achieve their strategic objectives, while also developing long term client relationships.  

What problems do you consistently solve for your clients?  
Throughout my career I have seen first-hand the power of communicating information and ideas as simply as possible. Utilising my accounting and investment banking background, I enjoy helping clients articulate their strategic options and associated financial impact to stakeholders whether it be shareholders, employees, banks or potential buyers. Clients are busy running their business and therefore appreciate perspectives on how external parties assess their business and industry. 

What are you happiest doing when you’re not working? 
Watching my four kids play sport. I remember being a shy kid growing up but sport helped me build confidence and bond with other kids. I am a big believer in the all round benefits gained from playing team sports – exercise and health, discipline, goal setting, working together, communication, ethics, interpersonal relations and mateship. 

Before kids I would have answered golf but there is not much time for that these days! I did sneak in a golf trip to Ireland with mates many years ago. 

What would your personal motto be?  
Be kind to people, life is far more pleasant that way.  

The best piece of advice I’ve ever been given is  from my grandfather who lived to the age of 102 – your family are your best assets! 

Merger Feasibility Case Study

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We recently completed a Merger Feasibility Study for two companies who are involved in the manufacture and distribution of industrial products for mining sector clients. 

Our role was to assess the strategic rationale for a merger between the two companies, provide recommendations and a delivery framework should a merger proceed.

Joint Venture, Merger or Acquisition – What’s the right path for your business?

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As we well know, all companies have their own specific strategic goals and go through their own lifecycles. But, it’s fair to say that the most common objectives across the board are business growth and creating shareholder value over time. In my experience many companies look at strategic options like partnerships, joint ventures, mergers or takeovers, to help them reach their shareholder objectives, more efficiently and effectively.  

The typical scenario is that two organisations decide that there’s a lot of value from them coming together – as I like to say “One plus one is more than two”. The impetus can either be that one business has run into issues or constraints that are costly for them to overcome by themselves, or that might be holding them back. Or more typically they can see that they fit well with another firm and there could be a lot of benefits in going to market together. They may have different products which fit neatly together and can be sold to a similar customer group or they can simply increase their scale and relevance in the marketplace giving them a better platform to grow and expand further.  

Whatever the driver, there are a few options when it comes to strategic moves that organisations can make to achieve growth and drive efficiencies. 

Joint Venture and Strategic Partnerships 

The overall premise of a Joint Venture (JV) is two companies deciding to go into business together where they combine their skills, expertise or product set in a new self-contained entity that they both own shares in. Both companies contribute assets, employees, resources etc. to try and achieve a better outcome for both, whether it be growth, some cost savings or better financial impact. 

The beauty of a Joint Venture, is that either business is not immediately giving up ownership or control of their company. So, if a JV doesn’t work out, it’s a lot easier to unfold. I often like to think of a JV as a “testing the waters” before going down the path of a Merger which has the potential to become quite tricky when things don’t work out.  

Another path that’s more informal than a JV is a Strategic Partnership. This is where two companies focus on a particular venture or project by combining their expertise and/or assets. This may be to achieve additional revenue or realise some efficiencies. I often suggest that businesses consider Strategic Partnerships as the first step in their journey working with another business. It is also a great way to find out if the two businesses have similar or complimentary cultures – crucial to a successful merger!  

Key Takeaway 

The most important thing that a business needs to consider when looking at a JV is to assess how much investment and resource they want to put into it as a way of scoping out the opportunity. It’s really important that this is decided upfront, as this can help the business think about the risk and the potential reward and give a framework in which to consider how much investment (time, money, resource) they’re going to put into the other combined entity. 


A Merger is typically thought of as a friendly deal where two companies come together and become one company. Structurally, from a legal perspective there’s typically an acquirer and an acquired company, where one entity buys the shares in the other.  However, both sets of shareholders continue to have management roles and influence on the direction of the company. The two organisations combine their skills and experience and work out where there might be some efficiencies and duplication of systems and roles, along with some cost savings of course. It’s important to note though, that if each entity has got very distinct capabilities that fit well together, then sometimes there is no reduction in employees and they might actually need to go on a hiring spree. 

Bringing two companies together has a number of benefits from extra revenue –  selling more to existing customers, going after new customers or selling different types of products – to efficiencies in operations.  This can all have a positive impact on the revenue line.  

There are other important elements that also need to be decided – What’s the new company going to be called? Will they have two separate brands or a completely new one? Where will the combined workforce be located?   

There’s also quite often, what I call social aspects, that get in the way of mergers. Sometimes both company owners have an emotional bond to the company or the brand name and even though it might make a lot of sense to put these two groups together, it doesn’t end up happening because neither are willing to give up their brand name or both CEOs want to stay in their respective roles and can’t agree who should go into a different one. This is why I believe that one of the most important aspects when considering a merger is cultural fit. I’ve seen a lot of scenarios where the financial benefits are extremely compelling but it’s all fallen over due to a lack of alignment in purpose and values.  

Key Takeaway  

A critical element of a merger being successful is cultural fit and the most simple and best way to know if the two companies are aligned is for shareholders and management to spend time with each other. Get to know the other company – how they operate, what they see as important, what their values are. I always advise companies to do their due diligence and talk to a range of people within the organisation to make sure everything lines up.  


The way to differentiate between a Merger and Acquisition is a merger is initiated by one party but both parties are very open to the idea and willing to explore it and do so in the spirit of coming together and working out what works best for both. An acquisition on the other hand involves one company (the acquirer) coming in and taking control and integrating the other (the target).  

There are a number of reasons why a company would want to be acquired. They can be very well performing but their shareholders are open to being bought out because they’re interested in pursuing other opportunities. Other times, the target business is underperforming, and the shareholders ultimately agree to the acquisition because they feel that the company is not heading in the right direction.   

Whatever the catalyst for the takeover for the acquiring company, it is absolutely critical that they do the right level of due diligence to make sure they know what they are buying. 

Key Takeaway  

For the acquirer, I always say “Do your due diligence” and understand the trade-off between the potential upside in value versus the risk you are taking. For the target I say “Know your Worth” by making sure you’ve got a strategic plan for the business and a view on its value – this puts you in a better position to negotiate.  

About the Author

David Royal is passionate about drawing on his 25 years of international experience to advise businesses and help them achieve their strategic objectives. David is able to help clients articulate their strategic options and associated financial impacts to help them achieve growth and drive efficiencies.

What I’ve learnt about building a thriving business culture.

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In early 2000, I hung up my corporate attire to travel the world with my husband who had suffered a heart attack. After many years in senior Institutional banking roles, I remember that one of the biggest adjustments was not having any of the accoutrements of a position in the business world – something that we’d grown quite accustomed to! It was a huge cultural shift and one that eventually led me to a slight career change when we returned home.

As the Head of Fundraising at The Smith Family, I recognised early on that Corporate Banking and Fundraising are actually not that different! You see, sales is all about creating a bond with your client, understanding their needs, listening to what they want to achieve, and taking a product and tailoring it to what is important to them. And of course, Fundraising follows this exact same path. It’s about taking a cause, telling a story and creating an experience for someone so that they want to invest in it. In the early 2000s, this was a very different way to think about Fundraising within the Not-For-Profit sector and I was able to lean on my strong network and years of developing robust business relationships to approach corporate fundraising in a completely different way. This was all happening at a time when the organisation was also undergoing a wider transformational change and one of my roles as a leader was to ensure that this new corporate culture was embedded, functional and actually made sense.

Over my 30 years of experience in working in ever changing business environments, I’ve come to recognise a common thread – those businesses that have succeeded have focused on working with their people in a way that is meaningful to them. Helping them managing their ambition, supporting their values and goals and underpinning their learnings and experience whilst delivering value for the clients and customers.

Today, I’m sharing my top three lessons for building a thriving company culture.

  1. Find tangible ways to bring your values to life.

A culture which is aligned with the values and expectations of the people who work there is critical. Successful cultural alignment is the continuity of your business’s vision and purpose so begin to develop your culture in line with expectations, ethos and values of your company. Start by identifying what works well, what doesn’t, understand what’s important to people and don’t shy away from the hard discussions.

Once you’ve documented your values and purpose think of simple ways to bring them to life. When I was working with The Smith Family we created round paper medals that represented each of our values and gave bundles to our employees so that they could ‘award’ them to colleagues whom they identified as reflecting a particular value. It was a simple gesture of peer recognition and at the end of the first month, employees proudly displayed their rows of medals and our values were being consistently recognised in the day-to-day operation of the business.

  1. Take everyone on the journey with you.

I always say “Don’t deliver the solution without consultation!” and getting buy in from your Board, management and staff at every stage of your journey is a critical factor in any cultural change. Use interviews, surveys, imagery and informal discussions to build out your path and once you’ve set your direction it’s all about communication, communication, communication!

I personally love the power of story-telling and telling it in as many different ways as you can. It’s all about creating a common story which brings people together and improves a sense of teamwork. At The Smith Family we did a lot of face-to-face – calls and workshops. But we also relied on emails and regular newsletters as well as lots of surveys so we could get a clear picture of what was working and what wasn’t and address the challenges early on. I think that one of the biggest tells of a thriving culture, is when people can see themselves as active participants who have agency and accountability.

  1. Don’t do too much too quickly.

Culture is not a ‘do it once’ thing. It really is a journey and let’s be honest you’re not going to get everything right all the time, but consistent focus and continued implementation is key. And because it’s a process it’s really important not to do too much too quickly. It can be tempting to announce change after change or initiative after initiative but taking the time to strategically plan your roll out, embed the change and acknowledgement from the outset that it will take time and dedication will set you up for success.

What’s more, the obvious benefits of a strong culture include happier staff, improved recruitment and retention, less sick leave and reduced costs. It also results in higher client satisfaction, lower business development costs and improvement in overall financial performance*. Through my experience I’ve also noticed that Clients are more willing to provide honest feedback (good or bad) which feeds into the customer service and product development cycle – as they say “Feedback is a Gift”.