Stan McKee, Former CFO EA and Former Board member of Arcsight
Until retiring in 2002, Stan McKee served for over 13 years as the Executive Vice President and Chief Financial and Administrative Officer of Electronic Arts Inc., the world’s largest developer and publisher of interactive entertainment. Mr. McKee served on the Board of Arcsight, which eventually sold to HP for $1.5 billion, as Chairman of its Audit Committee. He has also served on the Board of Leapfrog as Chairman of its Audit Committee since 2003.
Summary Notes on Working with Acquirers
Are companies bought or sold?
- Both, but the focus should be on building a great business
- As a public company, Stan had to vet the market for the best possible deal
- He had existing relationships with most potential acquirers, and companies and shareholders ended up benefitting from the bidding war between buyers
What is the mindset of the enterprise when thinking about acquisitions?
There are several approaches:
- Some want to grow via acquisition
- Some are looking for strategic or tactical fits to help grow a business silo
- At EA, the business development group sourced deals that may be helpful or strategic
- As a larger company, it’s very easy to acquire smaller companies, but very difficult to make them work
- Cultural fit is important
- An individual champion for an acquisition within the company is crucial
- Trying to blend cultures is challenging
The importance of developing relationships with potential acquirers
- These relationships are developed over time
- Industry conferences are a good place to meet key players