The Anatomy of a Perfect Acquisition by Stephanie Leshney

Ross Organic has a shared vision with Azelis Americas

California-based Ross Organic became part of Azelis Americas in January 2017. As a major personal care distributor in the western region, president and CEO Stephanie Leshney says she was used to calls from companies and investors interested in the business. However, when Frank Bergonzi, president and CEO of Azelis, rang, she immediately recognized that, this time, the call was significant.

Lesheny says it was clear that should the firm ever be interested in selling, the timing might be right. She also felt Azelis Americas' strategy of buying best-in-class distributors and allowing them to operate independently put Ross Organic in the best position for the future.

Her intuitive and positive response had good consequences for Ross Organic, which benefited from the enhanced stability of a larger organization and gained the ability to scale far more quickly. "With Azelis, we have the breadth and scope and the strength of their balance sheet behind us. This could help us expand more rapidly into adjacent lines, take more bets on emerging markets and further expand our service offering, such as our laboratory capabilities", Lesheny says.

Ross Organic continues to operate independently; however, Leshney says she finds comfort in being part of a larger and stronger family. When asked how she adjusted from being the boss to having a boss, Leshney replies: "I'm very lucky. Tim Dooling [president, care & household, industrial & institutional (HI&I), Azelis] is technically my boss but it feels more like a partnership. I still feel a similar sense of ownership and purpose in my role."

While she can udnerstand how founders/owners might struggle in a transition, Leshney believes the Azelis Americas team has perfected their "hands-off" and collaborative approach. The integration was seamless, which meant their human resources and finances were synchronized in the first 90 days.

Her advice for others looking to acquire and integrate successfully is to have a shared vision. Synergies need to be clear and there must be value in the proposition for customers too. Leshney notes there are companies that buy for short-term market share alone and then go and change the core business.

"When looking at the long-term value, it is obvious to outsiders that this will not be a winning strategy. Study after study shows the failure rate of acquisitions are somewhere between 70-90% and that is a real shame."

In Ross Organic's case, Azelis was looking for a best-in-class distributor, increasing its market share and core supplier synergies. "Frank Bergonzi made the process very simple and painless for us", she says. "It was a very quick eight-week process. When the ink on the deal was dry, we had essentially already achieved a successful partnership. The trust and clarity was there from the beginning."

Article published in the April-June issue of Chemical Distributor. See the full article here.