Staffing Merger Adecco/Olsten Merger Though Olsten Is Essay

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Staffing Merger Adecco/Olsten Merger

Though Olsten is seeking a minimum price of sixteen dollars per share for the acquisition of its staffing services by Adecco -- a price nearly double the current market value of the company's shares -- the amount of debt that the company is carrying and the restructuring that will need to be involved to effectively and efficiently incorporate the company into Adecco's operations does not warrant such a high price. With the stock currently trading at around $8.75 per share and given the other constraints and realities of the situation, Adecco should make an offer of $12 per share for the firm. This provides an extra incentive to Olsten shareholders to sell, as it presents a substantial premium over the market value of each share of Olsten stock, while at the same time minimizes costs to Adecco such that more...

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This price is more than reasonable given the current financial status of Olsten, and though there is a competing offer on the table Adecco's is far more likely to lead to long-term success and progress for the bulk of Olsten's employees and its half-century-old endeavors. This will need to be argued before Olsten's board to achieve agreement.
Far more than the other competitor, Adecco can ensure the continuation of the family-run Olsten even if the company falls under a new corporate umbrella, while a failure to sell to Adecco could mean the complete folding of the company or its purchase at a later date for a greatly reduced price. Adecco…

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