Translation Industry Mergers and Acquisitions
The language services industry trade press seems to love to report on mergers and acquisitions within the language services community. It’s news. A certain amount of industry buzz is generated by these events. And it’s something to write about for those in the business of producing interesting words.
Still we wonder about who benefits from these transactions? Do all market makers in the language services arena win? Or are there sometimes losers too?
Evaluated objectively we suspect the odds of acquisitions delivering fully on their promise might be somewhere around 50%.
For each group listed below we offer a few thoughts about how they’re potentially affected by mergers and acquisitions of language service provider organizations.
Acquiring Companies: If a company acquires another they’re obviously engaging the action because they believe it furthers their interests in some way. The calculation might be complex or simple. Some acquisitions fulfill their promise. Others don’t. Evaluated objectively we suspect the odds of acquisitions fully delivering on their promise might be somewhere around 50%.
Acquired Companies: Setting aside instances of unfriendly acquisitions, acquired companies go down the path willingly. Acquisitions can serve as an exit strategy for owners/shareholders. Shareholders that receive a value for their ownership that’s consistent with their expectations are in most cases likely pleased with receiving a cash amount for the value of their asset.
Translation Customers: Customers may benefit (or not) from having their go-to supplier of translation services purchased by another language services operation. If services are significantly affected, disruptions or unfavorable changes to the status quo might not be advantageous to clients. New capabilities within the acquiring organization, enhanced operational stability or market presence, are examples of post-acquisition effects that can benefit translation customers directly or indirectly.
Freelance Translators: This outcome for members of this category is harder to assess generally. There might be as many wins as losses. Acquisitions of smaller companies by larger ones could in theory result in more opportunity for linguists with an inside track. However, if project work is taken over by an acquiring company’s staff then the result is not so favorable for displaced linguists.
