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    Adecco Sa'S Acquisition of Olsten Corp: Group 6

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    Aditya Anand
    Adecco SA acquired Olsten Corp in 1998 to become the largest staffing firm in the world. Adecco was already the industry leader following its formation through the merger of Adia SA and Ecco in 1996. Olsten Corp, the 3rd largest staffing company, was facing financial difficulties with high debt levels and issues expanding further. Adecco saw Olsten as an opportunity to gain market share and expertise in new sectors like IT staffing. The acquisition solidified Adecco's position as the dominant player in the rapidly consolidating temporary staffing industry.

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    Adecco Sa'S Acquisition of Olsten Corp: Group 6

    Uploaded by

    Aditya Anand
    78 views6 pages
    Adecco SA acquired Olsten Corp in 1998 to become the largest staffing firm in the world. Adecco was already the industry leader following its formation through the merger of Adia SA and Ecco in 1996. Olsten Corp, the 3rd largest staffing company, was facing financial difficulties with high debt levels and issues expanding further. Adecco saw Olsten as an opportunity to gain market share and expertise in new sectors like IT staffing. The acquisition solidified Adecco's position as the dominant player in the rapidly consolidating temporary staffing industry.

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    Valuation of Olsten Group

    Original Title

    FACD_Group 6_Olsten

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    Adecco SA acquired Olsten Corp in 1998 to become the largest staffing firm in the world. Adecco was already the industry leader following its formation through the merger of Adia SA and Ecco in 1996. Olsten Corp, the 3rd largest staffing company, was facing financial difficulties with high debt levels and issues expanding further. Adecco saw Olsten as an opportunity to gain market share and expertise in new sectors like IT staffing. The acquisition solidified Adecco's position as the dominant player in the rapidly consolidating temporary staffing industry.

    Copyright:

    © All Rights Reserved
    Download as PPTX, PDF, TXT or read online from Scribd
    Download as pptx, pdf, or txt
    78 views6 pages

    Adecco Sa'S Acquisition of Olsten Corp: Group 6

    Uploaded by

    Aditya Anand
    Adecco SA acquired Olsten Corp in 1998 to become the largest staffing firm in the world. Adecco was already the industry leader following its formation through the merger of Adia SA and Ecco in 1996. Olsten Corp, the 3rd largest staffing company, was facing financial difficulties with high debt levels and issues expanding further. Adecco saw Olsten as an opportunity to gain market share and expertise in new sectors like IT staffing. The acquisition solidified Adecco's position as the dominant player in the rapidly consolidating temporary staffing industry.

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    © All Rights Reserved
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    Download as pptx, pdf, or txt
    of 6

    ADECCO SA’S ACQUISITION OF OLSTEN CORP

    Group 6
    Karan Khanna 19P141
    Aditya Anand 19P184
    Anirudh Chauhan 19P186
    Yash Dave 19P196
    Sudarshan Mall 19P228
    THE STAFFING INDUSTRY
    • Started in Mid- twentieth century to provide unskilled and mainly temporary workers in Industry but
    gradually started providing skilled workforce as well for longer assignments
    • Broad Services include permanent placement, payroll, outplacement and other managed services
    • Primary Reasons for development of Industry : Economic Expansion and growth of “Professional
    Segment” with new needs such as diverse work-experience and flexible careers
    • Top 5 companies had 27% of Market Share. Industry had entered consolidation phase with multiple
    acquisitions happening spurred by globalisation. In 1998, 514 acquisitions happened
    • Market growth was 17% CAGR in US between 1993 to 1998. Specialised Staffing in areas such as
    Accounting, Legal Staffing etc. Specialized Staffing Margins – 4.9% vs Generalized Staffing – 2.2%
    • Large Staffing Companies became thriving labour exchanges
    • Employers were motivated to opt their services for benefits of economies of scale, just in time
    labours, reduced costs in recruiting & training etc
    • Employees were motivated to opt their services for benefits of ease of access to jobs due to the size
    and negotiation powers of these setups
    • Staffing agencies were spending massively on developing IT infrastructure for various analytics
    ADECCO SA
    • Founded in 1996 , and by 1998 had 3000 offices across 52 countries
    • Created by a merger of the number two and three staffing firms of the world – Adia SA and
    Ecco. Combined Sales were CHF 15.3 billion on 1998, risen exponentially from CHF 6.2 billion
    in 1996
    • Addeco was now Industry Leader with Quadruple increase in stock prices
    • Market Leader in France, Canada, Spain, Switzerland and Australia and Second in US and UK
    • With its consistent Strategy, targeted 20 % market Share in each of the 11 largest economies
    • Revenue Share : 88 % - Generalized Staffing, 12 % - Specialized Staffing
    • Acquisitions since formation:
    1) TAD Resources Intl
    2) Seagate Associates
    3) ICON Recruitment
    4) Delphi Group
    5) Career Staff Co
    OLSTEN CORP
    • $5 Billion Home and Healthcare firm founded in 1950, went public in 1967

    • 3rd Largest Staffing Co., Growing in IT Sector

    • Family owns 16% of Common Stock but 66% of Voting Rights via Class B shares

    • $150 million invested into acquisitions in Europe and LatAm

    • Current Issues : Govt Austerity, Medical Fraud Costs, Inability to raise further debts in excess of
    current $746 million outstanding

    • Method of Valuation Opted: Discounted Cash Flows


    VALUATION
    THANK YOU

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