ABPSA. Studying the Acquisition of a Big Competitor

In October 2001 the Board of Directors of the Borges Group held an extraordinary meeting. The reason for the meeting was well known to all present: Koipe, the leading Spanish olive and sunflower oil company, had become the target of a takeover bid by another Spanish company, SOS Cuétara (a producer of rice and biscuits). At that meeting, the Board of Directors would have to decide whether to respond with a counterbid. Koipe had been one of Borges' main rivals and gaining control of it would give the Borges Group great strategic advantages. But first they would have to consider not only whether acquiring Koipe was the best strategic option but also the implications for the organization and the family. How would the takeover of such a large company (Koipe was three times the size of the Borges Group's oils division and was listed on the stock exchange) affect the group structure and the family values on which it was built. If it opted for rapid growth to become a major player, the family business might lose its independence.