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MHM AM SUPPLIER – DEVELOPMENT STRATEGY OPTIONS WITH MHM.

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Presentation on theme: "MHM AM SUPPLIER – DEVELOPMENT STRATEGY OPTIONS WITH MHM."— Presentation transcript:

1 MHM AM SUPPLIER – DEVELOPMENT STRATEGY OPTIONS WITH MHM

2 MHM MHM ‘ACQUIRE AND BUILD’ PROJECT FOR CLIENT SOURCE : MHM  MHM CLIENT GENERATED 41 INTERNAL OPTIONS TO ENTER CENTRAL/EASTERN EUROPE !  BUT CHOSE MHM IDENTIFIED ACQUISITION OPPORTUNITY IN CZECH REPUBLIC – SWEETSPOT OF CENTRAL/EASTERN EUROPE  CLIENT MOVED IN QUICKLY - ONCE OPERATION UP AND RUNNING, BIG NEW PLANT - PLUS FURTHER LARGE ACQUISITIONS

3 MHM POLISH ELECTRONICS FACILITY ACQUISITION - CLIENT ACCESSES 40% PA GROWTH MARKET WITH MHM PROJECT OBJECTIVE :BRING ON LOW RISK LOW COST EAST EUROPEAN ELECTRONICS ASSEMBLY REASON :TO ACHIEVE HIGHER GROWTH FOR NORTH AMERICAN CLIENT METHODOLOGY :CHOSE OEM DIVESTMENT ROUTE AT OUTSET THOROUGHLY RESEARCHED EAST EUROPEAN OEM DIVESTMENT OPTIONS: - DETERMINED SPECIFICATION FOR ACQUISITION - CONFIDENTIALLY CONTACTED MANY OEMS - IN-DEPTH TELEPHONE INTERVIEWS WITH 12 - POINTS RANKING ANALYSIS AND 100 PAGE UPDATE - ACQUISITION TOUR PLANNED AND ACCOMPANIED DECISION :PROCEED WITH TOP RANKED SITE ACQUISITION AND SUPPLY AGREEMENT BENEFITS :QUICKLY ENTERED 40% PA GROWTH MARKET FROM ONE GROWING AT 15% - NOW 0% PA IMMEDIATE LOW COST EUROPEAN MANUFACTURE FOR EXISTING CUSTOMERS

4 MHM MHM PROJECT REDUCING EU OPTICAL COMPONENT MANUFACTURE COST – TRANSFERRING TO CHINA THE GLOBALLY FASTEST GROWING MARKET OBJECTIVE :EXAMINE OPTIONS FOR SUBCONTRACTING TO EASTERN EUROPE REASON :FEELING THAT EU OPTICAL COMPONENT MANUFACTURE COST TOO HIGH METHODOLOGY :INCLUDED CHINA AND MEXICO INITIALLY TO GIVE PERSPECTIVE, THREE WEEKS AFTER PROJECT COMMENCED CHINA BECAME MHM’S NUMBER 1. ANALYSIS INCLUDED: – VIEW SUBCONTRACT OPTIONS (OMS/EMS GLOBALLY) - VIEW IN-HOUSE OPTIONS (BUY SHELL, ACQUIRE LOCALLY) - EVALUATE ABOVE OPTIONS WITH POINTS RANKING SYSTEM CLIENT ‘CHANGED ITS MIND’ FROM FAVOURING THAILAND & SINGAPORE DECISION :ACQUIRED COMPANY WITH SIGNIFICANT MANUFACTURING BASE IN CHINA BENEFITS :CLIENT UPDATED WITH CHINESE CAPABILITY GROUP’S UNDERSTANDING CHANGED COMPETITIVENESS INCREASING 6 MONTHS AFTER START OF PROJECT-

5 MHM OEM / BRAND NAME MATURE TECHNOLOGY DESIGN OUTSOURCED WITH MHM PROJECT– EMPHASIS OF EFFORT ON GROWTH OBJECTIVE :TO REMOVE OEM’S ORGANISATIONAL INFRASTRUCTURE COST RELATED TO MATURE PRODUCTS, ALSO GUARANTEEING LOWER MEDIUM TERM DESIGN COSTS REASON :EQUIPMENT MANUFACTURER CLIENT AWARE THAT MATURE DESIGN OPERATION OVERSIZED IN COMPARISON TO HIGHER GROWTH OPPORTUNITIES METHODOLOGY :DEVELOPMENT OF PARTNER SPECIFICATION WAS FOLLOWED BY GLOBAL SEARCH IDENTIFYING MOST COMPETENT DESIGNERS. PROJECT COMPONENTS INCLUDED: - IN-DEPTH SPECIFICATION OF BEST PARTNER - RESEARCH IN ASIA, EUROPE AND AMERICAS FOR MOST SUITABLE DESIGN COMPANIES - INITIAL CONTACT TO IDENTIFY COMPANIES OF INTEREST - 20-30 QUESTION INTERVIEWS WRITTEN UP - RANKED PROSPECTS DELIVERED TO CLIENT IN RECOMMENDATIONS ANALYSIS DECISION :SITE DISPOSAL AND EMPLOYEE TRANSFER BENEFITS :NUMEROUS INTERESTED PARTIES BID-UP DESIGN CONTRACT CONDITIONS. CLIENT’S CONFIDENTIALITY 100% PROTECTED (NOT SEEN TO BE SELLING SITE/COMPANIES) COMPREHENSIVE ANALYSIS ALLOWS BACKTRACKING ON DATA BY ALL INVOLVED DECISION CONFIRMATION MADE EASIER

6 MHM MHM – HISTORICAL CEE PROJECTS FOR CLIENTS SOURCE : MHM HISTORICAL  CZECH REPUBLIC ELECTRONICS ACQUISITION AND DISPOSAL PROJECTS  MANY OTHER CENTRAL/EASTERN EUROPE, INDIA, BRAZIL AND CHINA PROJECTS - EG GREENFIELD METALWORK AND ELECTRONICS INTEGRATION PROJECT - ONE PROJECT PER QUARTER WHEN BUSY !  $100M OF CLIENT FUNDS AVAILABLE FOR UP TO 5 ACQUISITIONS FOCUSING ON ELECTRONICS – CZECH REPUBLIC IN SWEETSPOT FOR THIS PROJECT

7 MHM UK/IRELAND REGIONAL FACILITY SOLD BEFORE LOSSES ACCUMULATE – MHM PROJECT OBJECTIVE :TO DETERMINE IF MARKET WILL SUPPORT PROFITABLE UK/IRELAND REGIONAL OPERATION REASON :LOSSES FORCAST IN NEAR FUTURE FOLLOWING REMOVAL OF KEY CUSTOMER BUSINESS METHODOLOGY :MHM FIRSTLY CARRIED OUT AN ASSESSMENT OF THE TOP 100 CUSTOMER PROSPECTS FOR THIS FACILITY IDENTIFYING: - WHO WOULD PLACE WORK IN THIS FACILITY? - WHY? AND IN WHAT VOLUME? - LEVEL OF INTEREST? SUFFICIENT? DECISION :MHM’S RECOMMENDATION WAS TO DIVEST THE FACILITY BENEFITS :THE MAJOR BENEFITS FROM MHM’S TIMELY INTERVENTION WERE: - AVOIDANCE OF LOSSES - AUTHORATITIVE ANALYSIS LEAVES ALL CLIENT MANAGERS AGREEING FUTURE PATH DISPOSALS

8 MHM AM SUBCONTRACTOR OPTIMAL STRATEGY OVERVIEW BY MHM

9 MHM AM SUBCONTRACTOR OPTIMAL STRATEGY (CONTINUED)

10 MHM AM SUBCONTRACTOR OPTIMAL STRATEGY (CONTINUED)

11 MHM AM SUBCONTRACTOR ATTACHES TO GROWTH OEMS AM

12 MHM SOURCE : MHM AM ‘PLUGS INTO’ ELECTRONICS SYSTEM SUPPLIERS WITH GLOBAL MARKETS – BUILDS GLOBAL NETWORK


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