There has been a lot of publicity lately about the potential merger between T Mobile and Sprint in the USA. These are very significant mobile phone networks and both have a global presence, though it is their US businesses that are coming under the most scrutiny in the face of a potential merger.
While there can be clear reasons why two companies can benefit from merging, especially if they provide almost identical services like Sprint and T Mobile, there are of course questions around how the companies will operate after they merge, and what will become of the employees who work for them. All of these things are often discussed beforehand by the companies. They will usually also have a legal firm involved in the discussions, like Sidley Austin (https://www.sidley.com/en/us/services/ma/), to ensure everything is being done legally. The two companies want the merger to occur naturally and easily, so they will try and work everything out before they announce the merger.
Redundancy Can Happen
First, the bad news. When two similar companies merge, they tend to have too many people doing the same jobs. This means they need to scale down. It isn’t always the case – sometimes two businesses need all of their people to support their customers even after a merger, but normally they don’t. A company like T Mobile will not, for example, need as many customer service representatives as a new merged company with Sprint, and T Mobile and Sprint needed as separate entities. This means that lay offs in minor positions may well happen.
Chances to Climb
However, despite the fact that less people tend to be needed to run one business than two, a merger can present new opportunities for some people. It creates a bigger company, and therefore one where prestigious roles are even more prestigious. Those in middle management roles, for instance, may well find themselves able to make the jump into senior roles as the company is reshaped after the merger. This is not unusual. Any kind of corporate shake up tends to have winners and losers, and those who are able to make a place for themselves amid the changes and new strategies tend to do well whereas those who are more resistant to change tend to lose out.
How Are Mergers Managed?
Mergers and acquisitions are of course a big part of business, and one employees of major corporations are often a bit blind-sided by. In actual fact, there are lots of legal elements to a merger, and usually your company, and the company you merge with, will have engaged a corporate broker to oversee things. Corporate brokers such as W H Ireland check that everything that happens on the road to the merger is legally compliant, and look after the interests of the business and its employees throughout the process. There is no doubt that a major merger like that that is rumoured between Sprint and T Mobile won’t have a very good corporate broker working on it.
If your company is set to merge with another, it can be a time of serious doubt and anxiety as an employee. However, mergers can also be good for your career. Get as much information as you can and you are sure to be able to make the best of this unsettled stage in your job.