Worcester Business Journal

14 Worcester Business Journal • February 29, 2016 www.wbjournal.com H E A LT H Y B U S I N E S S << The price of innovation F or a local company, the decision to be acquired by a larger firm from out of state can be a tough but smart call. Maybe a larger organiza- tion can offer the capital to forge ahead with a big project or the administrative resources to let employees focus on their core jobs. Maybe merging into a company with a related mission can open up new opportunities. But for employees – and for the local community – finding out a company has been purchased can be disconcerting. "People always worry or get nervous with change," said Tim Cummings, executive director of the Marlborough Economic Development Corp. "Change will often raise people's anxiety, but it doesn't need to be the case that folks should worry." In early February, Connecticut-based Acme United Corp. announced it had acquired Marlborough toolmaker DMT for $7 million. A week later, Astella Pharma Inc. of Japan completed the acquisition of another Marlborough company, Ocata Therapeutics, buying all outstanding shares of the company for about $379 million. In far bigger news elsewhere in MetroWest, Hopkinton-based EMC Corp. is in the process of being acquired by Texas computer giant Dell Inc. for $67 billion – the largest tech merger ever. Dynamic signs These sorts of deals can sometimes lead to job losses, but they also reflect a dynamic regional economy, Cummings said. Lots of startups are constantly growing, and many hope to eventually be acquired. At the same time, large corporate offices – like the GE Healthcare Life Sciences division that relocated to Marlborough last year and the Dow Chemical campus in town – are often the ones acquiring smaller companies, either from the local area or from elsewhere. On a global scale, 2015 was a record year for mergers and acquisitions with deals worth a total of $4.3 trillion. A lot of that was driven by activity in the U.S., where low interest rates and share- holder demand for investment oppor- tunities have pushed big companies to seek out new opportunities. Susanne Morreale-Leeber, president and CEO of the Marlborough Regional Chamber of Commerce, said it can be tricky for community business leaders like her to maintain close relationships with companies when they get acquired. That's partly because the deals often come with personnel changes and part- ly because more decisions are made in far-away offices. Morreale-Leeber saw the difficulties of dealing with remote owners in 2011, when Fidelity Investments announced plans to close its 1,100-employee Marlborough campus. She talked with the local managers about keeping some jobs in the city, but it was out of their hands. "The decision had been made," she said. "I learned firsthand that there really is not a whole lot that a commu- nity can do." Selling the region On a broader scale, promoting good schools and quality-of-life amenities is a way to encourage business invest- ment, Morreale-Leeber said. Even if one company leaves, a vibrant area with talented workers and companies of all size is attractive to others. For Marlborough, one proof of that came in Tim Cummings, executive director of the Marlborough Economic Development Corp. MetroWest leaders consider outsider acquisition part of innovative economy BY LIVIA GERSHON Special to the Worcester Business Journal 0 1 2 3 4 $5 '07 '08 '09 '10 '11 '12 '13 '14 '15 Value of global M&A deals (In trillions of dollars) $4.3T Value of global M&A deals Source: MergerMarket Global and regional M&A: 2015

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