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ISG Chairman Connors Ponders Major Buy
In an exclusive interview with DRNO, Mike Connors admits the quarter billion dollars raised last month for his new acquisition company is 'burning a hole in our pockets' and that ISG will base its strategy on buying one information services firm worth $200-700m, within eighteen months tops.
The full 11-minute podcast is available via www.mrweb.com/earpiece .
In it, Connors says his team has received 'a number of inbound calls' from companies 'intrigued with the idea of merging their business with ours', and while he keeps all his options open - 'We haven't ruled out anything at this stage' – he gives some hints as to which types of company might be particularly appealing.
Connors is in no doubt that the ISG management team (DRNO www.mrweb.com/drno/news6418.htm ), which owns 18-19% of the stock, is likely to be the mainstay of the firm's appeal to potential acquisitions. 'Hopefully we have an edge – a seasoned team of people that understand the information services industry from a real operating standpoint', including 'how to productise and globalise'. He emphasizes the team's broad base in terms of past experience, including international understanding, and adds 'whatever company we acquire, we will globalise it.'
He also gives a strong hint that the firm will look to expand the senior team sooner rather than later: 'the team ... will be deeply involved in an executive capacity in whatever company we acquire, because we are looking to use the first company as a platform and to build it out and grow it quickly. Our sense is that with the rate we intend to grow at, we will not have enough talent – the amount of talent we will need in the future will be even greater than the amount we have.'
In terms of potential targets, Connors is cagey, but he does have good words for online research, 'a small component of the industry but growing rapidly'. He comments: 'Our sense is that we like Internet-based services – it's here, it's here to stay, it's accessible, it's easy to use, it's quick, it's got some cost advantages, so those services that can collect, aggregate, analyse data using Internet-based services are I think 'hot' and certainly would be of interest to us.' ISG will look to buy a US-based company or one that is 'European-based with heavy US operations'.
He also expresses interest in 'a company with a leading position in a niche... which may not necessarily be a mile wide yet', and suggests a strong penchant for a firm combining its own information gathering with a consulting pedigree: 'If you have some data content with your advisory services, in my view that's a very strong combination in today's world.'
ISG's web site is at www.informationsg.com .
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