ACG Investment and Sourcing in India event

I attended this breakfast roundtable discussion hosted by the Chicago chapter of the Association for Corporate Growth, which included a few contributors with a wealth of experience in India who expounded upon the past & future of the country.  It seemed like the group was evenly divided between those who’ve worked in India & those interested in learning about how things work there.

Pradeep Nedungadi, Principal of Visthar, suggested choosing a headquarters location based on skills located in that region.  He compared India with it’s neighbor in saying China has advanced because of it’s government, while India has depite it’s government, although it’s expected the Indian government will play a decreasing role in the econonmy in the next 10 years.  IT has grown so tremoundously because the government couldn’t control it.  There are still lots of hoops to jump through to found a business there, so he recommended finding a local partner to deal with problems, but he sifted through 1000 companies to find the handful that could get the job done.  There are some states in India where he won’t recommend manufacturing because the population is too intelligent for that there.

James Pavlik of Baird Venture Partners gave a short presentation which included these interesting tidbits:

-cited the offshore nation which showed India has advantages in labor costs, size of labor pool, language, & government support over China, the Phillippines, Eastern Europe, Latin America, & Russia.

-a 2005 McKinsey survey indicated India was the leading offshore destination in IT, 
call centers/help desks, human resources, finance & admin, business 
research/analytics, & just barely in R&D

-Venture Intelligence India informed that private equity investment in India has skyrocketed from $2.2B in 2005 to $7.5B in 2006, & $14.2B in 2007

Krrishan Singhania of Singhania & Co. provided some of the legal background 
on why/how India has opened up so much in the last 10-15 years. Government use of IT is driving some growth in IT.  There are still caps on investments in insurance & defense industries in India.  The new airport in Bangalore is completed but not open only because the infrastructure leading to it is not yet finished.  Profits can be repatriated, but taxes must be paid on them.  The legal market is still 100% closed to foreigners, so locals like Krrishan are invaluable.

Attorney David Laverty distributed an couple of insightful articles ( indiaacquisitions1 indiaacqusitions2 ) on acquiring Indian companies.

My take is events like these where you can get 1st hand stories from people 
who’ve been there are of great help, especially in someplace as complex as 
India.  I  wish we could have had a bit more input from those desiring to learn more about India in what they’re seeking & the obstacles they’re confronting in attempting to do business there.

Euronext speech

I attended a luncheon sponsored by the National Investor Relations Institute featuring a speaker from NYSE Euronext, the exchange which merged with Archipelago in Chicago, who was speaking on the globalization of financial markets.

Up until 2004 each of the exchanges were essentially single asset classes. The NYSE then changed its strategy to use globalization, diversity asset classes, & leverage technology. In 2006, the NYSE & Archipelago holdings hooked up & went public. In 2007, NYSE merged with Euronext which had 4 exchanges in Europe, to create the 1^st “global markets,” & started their asset diversification in derivatives. They trade $141 B daily, which is 1/3 of the cash trade in the world. They own 5% of the Indian exchange (capped by the government), & 1% in Brazil. They have interests in Tokyo, (which is not yet publicly traded), Malaysia, & the Philippines

There is increasing global competition for capital formation. In 1995, 57% of global proceeds were listed in the U.S. That # has dropped to 18% in 2006. In 1999, private placements were $57B. In 2006, that had risen to $137B. Europeans no longer need to access capital in the US. Brazil is getting deeper & more liquid. Of 64 public exchanges worldwide, only 2 are in the US. Growth in derivatives is 30% to $450B dwarfs others. American holdings overseas was in $7.2B in 59 funds 5 years ago to $87B in 217 funds now. Foreign investment is up 90% in the US.

In the future, consolidation into 5-6 groups is inevitable. Regulation is becoming more global & there will be more convergence with consolidation. Europe offers “fast path” listings for US companies which are already listed with SEC documents instead of European listings.

My purpose in attending was to find out what was left of Archipelago in Chicago.  It seems as if only those responsible directly for the Arca Trading Platform.  Everyone else has relocated to New York.

British-American Transatlantic Business Conference

I attended the British-American Transatlantic Business Conference-Connectivity in a Transatlantic World conference, organized by the British-American Business Council-Chicago, & title sponsor British Airways for a couple of days recently.  I believe this was BABC’s annual conference which moves around the US & UK each year.

Rhian Chilocott, head of Confederation of British Industry’s Washington office presented a briefing on UK investments in the US babc2008cbibritish-investment Her most amusing comments were on a couple of alternative titles for her presentation, either “with your wussy $, we can buy anything we want,” or “Sterling assets,” since highlighting British breasts should result in more downloads.

Transatlantic UK-US trade relations was addressed by government officials from both sides of the pond.  I don’t have enough space to even summarize, so contact me for details.

“Current trends in customer global communications needs” was essentially a commercial for/by British Telecom-Americas.

Lunch Keynote speaker-Woody Harford, Sr. VP-Commercial for North America, British Airways provided a comprehensive & humorous look @ BA.

“Generation X & Y-will they be your future employees?” babc2008generationxandy The conference utilized real-time surveys of the audience which were determined by hand-held devices-(I didn’t track the results).  The panel differentiated between digital pioneers & natives, & that younger generations seek autonomy & control while baby boomers seek 1 career with multiple companies.   Also we boomers keep making the recurring mistake of assuming others want what we want.

“The evolving trust landscape: what it means for business & stakeholder relationships” was presented by Mark Shadle, Exec VP/Pres-Central Region, Edelman Public Relations babc2008edelmantrustbarometerukus I found this to be the most interesting & valuable presentation.  I can’t add any more than what was presented.

The gala reception @ Adler Planetarium proved to be a lovely evening.

The 5 minute welcome by Mayor Richard M. Daley brought out that Tony Blair is 1 of his idols.  He stuck around so that we could wish him Happy Birthday, but I was surprised he didn’t stick around for the Olympics presentations.

The “Impact of Olympic Host on a Finanacial Center City” offered in interesting comparison/contrast between an upcoming Olympic city with an aspiring 1.

“Tailoring the Cord Brand Idea to be relevant around the world” showed a few great examples from LifeFitness & Dyson of different approaches to global branding, either complete revamp to make them consistent across countries, or keep it simple from country-to-country.  I’m still working on getting at least 1 of the presentations.

“The impact of emerging technologies & social media” was presented by Terry McKenzie, Sr. Dir., Employee communications & Change Management @ Sun Microsystems babc2008sunmicrosystems I spoke with Terry on the bus on the way to & from the Adler Planetarium for the gala dinner.  She’s quite a character.  Look for her tmac blog @ blogs.sun.com

I missed the presentation “2 countries separated by a common language?,” featuring 2 principals from Mintel Intl.

BAGOL-British American Group of Lawyers meeting addressed such topics as risk reduction in litigation, patent law changes, audit letter issues, employment, Sarbanes-Oxley.

According to the attendees list, 227 attended the event, of which 81 appeared to be speakers or sponsors, & 10 seemed to be visiting from BABC’s in the UK.

My only criticism of the conference is that there wasn’t enough US-UK interplay:  only 6 out of the 10 presentations dealt directly with British-American business topics.  Further, as important as the Brits are in Chicago & America, we seem to see/hear relatively little from them.  A number of other smaller countries are more active in the local international scene.  I’d like to see more local events from our most important European trading partner.

real estate services expanding internationally

Robert Manor contributed this article to the Chicago Tribune U.S. real estate expertise helps lead international developments which describes how US real estate firms are lending their expertise all over the globe. This is just another example of services leading the way in international trade. It’s a great way for Americans to leverage specific knowledge throughout the world.

I’m not sure I buy the REIT proliferation reasoning for this expansion as much as the realization of the rest of the world that real estate is a very basic investment & that pride of ownership betters whole economies. With the tax deductions the US government gives for mortgage interest, it’s what’s built America. Few of my friends/colleagues in Germany owned their homes, but have since learned their value. While residential real estate is 1 of the most locally-oriented businesses of which I know, commercial/industrial is increasingly international, as this article demonstrates. Especially with the high value of the Euro & other foreign currencies, foreigners are contributing greatly to the construction of the US.

While partnerships with local firms work well when selling products in foreign countries, I question their long-term viability for services companies. As long as there is a continuing need for product, there will be a need for international partners. But for services companies, the relationship with the client is as much if not more important than the service itself, & the client often will turn to the local partner before the global one because those are the people with whom they find the most affinity. Personally I often hear of services firms with international partners & think that these partners are just a convenient means to not learn & invest in other places where their customers are doing business.

Interestingly, while attending the British American Business Council event the day this article came out, I met Edward Lewis, (a scarily similar name to a dear old college roommate of mine), of Jones Lang LaSalle, whose firm was mentioned in the article. Edward had lived & worked in London for a number of years & even obtained a UK equivalent to a green card. If I remember correctly, I believe he also lived/worked in Zurich, Switzerland, but didn’t get so deeply embedded that he learned Suisse-Deutsch, the swiss bastardized version of German. It’s great to see that there are some globally aware people working in Chicago. 1 of my sales managers from Xerox many years ago (Frank…something I believe, help me if you can) moved on to what was then LaSalle Partners. I wonder where he is today?

Peruvians in Chicago & Americans in Peru

Jose Francisco Tagle of the American Chamber of Commerce in Peru was in town with a 12 company delegation visiting the Global Food Expo @ McCormick Place. He gave this presentation @ the World Trade Center Illinois amchamperu-tradeinvestment

To give you an idea of America’s interests in Peru, here’s the list of AmCham Peru’s members:

-3M GENERAL OFFICE -ING GROUP
-ABBOTT INTERNATIONAL LTD. -ADECCO
-AEROPOST INTERNATIONAL SERVICES -AMERICAN AIRLINES, INC.
-AMROP HEVER- BATTALIA WINSTON -THE CHURCH OF JESUS CHRIST OF LATTER-DAY SAINTS
-AT&T GLOBAL NETWORK SERVICES LLC. -AVAYA INC.
-BERLITZ INTERNATIONAL INC. -CHESTERTON BLUMENAUER BINSWANGER
-BRIGHTSTARCORP -BRISTOL-MYERS SQUIBB COMPANY
-BURLINTON RESOURCES INC -CAMBRIDGE INTERNATIONAL CONSULTING
-CHEMONICS INTERNATIONAL, INC. -CHEVRONTEXACO
-CISCO SYSTEMS INC. -CITIGROUP
-THE CLOROX COMPANY -THE COCA-COLA COMPANY
-COLGATE- PALMOLIVE COMPANY -COLLIERS INTERNATIONAL
-BT INFONET -COMSAT INTERNATIONAL
-CONTINENTAL AIRLINES -CHF INTERNATIONAL
-DBM, INC -DELOITTE TOUCHE TOHMATSU
-DELTA AIR LINES INC -DIEBOLD INCORPORATED
-UNIVERSAL COMMUNICATIONS SYSTEMS INC. -THE DOE RUN CO.
-DUKE ENERGY INTERNATIONAL -DUN & BRADSTREET INT.
-PSEG -ELI LILLY AND COMPANY
-EMC CORPORATION -EMERSON NETWORK POWER SYSTEM LATIN AMERICA
-EQUIFAX INC -ERNST & YOUNG
-FLUOR DANIEL INC. -FMC CORPORATION
-FULBRIGHT COMMISSION -G.T.H LA
-THE WACKENHUT CORPORATION/WACKENHUT INTERNATIONAL -THE GOODYEAR TIRE & RUBBER CO.
-GREY GLOBAL GROUP INC. -HANOVER COMPRESSOR L.P.
-HARDCORP, INC. -HEIDRICK & STRUGGLES INTERNATIONAL INC.
-HELLMANN WORLDWIDE LOGISTICS, INC. -THE HERTZ CORPORATION
-HEWLETT – PACKARD COMPANY -INTERNATIONAL HOTELS GROUP
-HUNT OIL COMPANY -IBM WORLD TRADE CORPORATION
-INTRA GLOBAL TRADING CO. INC. -EXPRESS TRADING SERVICES INC.
-IRON MOUNTAIN -JOHNSON & JOHNSON INTERNATIONAL
-ANTHONY INTERNATIONAL -JP MORGAN
-MARRIOTT INTERNATIONAL -KIMBERLY-CLARK LATIN AMERICA OPERATION
-EASTMAN KODAK COMPANY -KORN/FERRY INTERNATIONAL
-KRAFT FOODS INTERNATIONAL -LEO BURNETT COMPANY, INC.
-LIPO CHEMICALS, INC. -LUCENT TECHNOLOGIES INC.
-MANPOWER INC. -MARSH INC.
-FOOTE CONE & BELDING – LATIN AMERICA -MCCANN-ERICKSON WORLDWIDE
-MCDONALD’S CORPORATION -VERIZON BUSINESS
-MERCK & CO., INC. -MICROSOFT CORPORATION
-PHELPS DODGE CORPORATION -NEWMONT MINING CORPORATION
-MOTOROLA CORPORATE EXECUTIVE OFFICES -MSA INTERNATIONAL
-NCR CORPORATION -NII HOLDINGS, INC.
-NOVARTIX / GERBER PRODUCT COMPANY -OCCIDENTAL OIL & GAS CORPORATION
-BECHTEL GROUP INC. -OWENS-ILLINOIS, INC.
-THE PROCTOR & GAMBLE CO. -P&H MINING EQUIPMENT
-PANDUIT CORPORATION -PAYLESS SHOESOURCE INC
-PAYLESS SHOESSOURCE -PEPSI COLA INTERNATIONAL
-PFIZER INC. -PHILIP MORRIS LATIN AMERICA
-POLYCOM INC. -THE DOW CHEMICAL COMPANY
-RENA WARE INTERNATIONAL INC. -HARBISON-WALKER REFRACTORIES CO.
-S.C. JOHNSON & SON, INC -SCHERING PLOUGH INTERNATIONAL
-SCIENTIFIC GAMES CORPORATION -LARM – LATIN AMERICA RELOCATION MANAGEMENT
-SEMPRA ENERGY -STARWOOD HOTELS & RESORTS, WORLDWIDE INC.
-ORACLE CORPORATION -SOUTHERN PERU COPPER CORPORATION
-STANTON CHASE INTERNATIONAL -HUDSON HIGHLAND GROUP, INC.
-GLOBALSTAR LLC -THE MAPLE COMPANY
-THE WASHINGTON POST -THUNDERBIRD GLOBAL MBA
-TRANSWORLD PAYMENT SOLUTIONS -TURNER BROADCASTING SYSTEM LATIN AMERICA INC.
-TYCO -UNISYS CORPORATION
-DEPARTMENT OF STATE -UPS UNITED PARCEL SERVICE
-UPS LOGISTICS SERVICE AMERICAS, INC -VOXIVA, INC
-WALSH ENVIRONMENTAL SCIENTISTS AND ENGINEERS, LL -WESTFIRE INC.
-WYETH -XEROX CORPORATION