|Merger and acquisition opportunity…
DelConsulting has failed in its friendly attempt to merge IT-Development, its IT branch, with CellTracker LTD.
“The affair started on November 24 last year, when a financial friend in London tipped us” said Perret, MD at DelCondulting. “CellTracker had called for administration (equivalent of chapt.11 in US) for an obvious reason related to a lack of cash and therefore the impossibility to pay administrative burdens and suppliers”.
After a short meeting with the DelConsulting shareholders, Perret contacted Mike Mc Pherson, Managing Director at CellTracker expressing the company’s interest in rescuing CellTracker. For Del, there were two main objectives: Take over the on-going concern as well as finishing a large-scale project at a common customer in Belgium. Del had lost the bid for tender against CellTracker in September 2004 and was since then very septic about Celltracker’s capacity to deliver an integrated solution offering the client all the flexibility he needed.
Therefore when Del’s people heard about CellTracker’s trouble they were very interested to rescue their customer as well.
However looking back, company’s lawyers and business advisers consider that neither the management of Celltracker nor the administrator aimed at saving CellTracker. The focus was put on selling IPR that were never registered, get away from the claim of the Belgian customer, and start a new company providing similar products and services.
Things turned sour when after two months of communication DelConsulting hit the wall trying to discuss the project status with CellTracker’s project team. “Former CellTracker’s management was willing to assist us by selling restricted IPR as well as their support on the core product, but we could never check the existence of a workable version” Del’s MD added.
“Finally, any hope to come to an agreement disappeared when we discovered that CTNova was born from CellTracker’s ashes and that the company already prospected customers in the Middle East” concluded Perret, mentioning the following quote from Bill Cosby: “I don’t know the key to success, but the key to failure is trying to please everybody”; also promising that if a new opportunity came, he would mandate his company"s lawyers first.