Gerard Baynham

As a partner at Water Street Partners, Gerard runs the Joint Venture Advisory Group (JVAG) and the Joint Venture Deal Advisor (JVDA). JVAG and JVDA are Water Street Partners’ membership groups for executives overseeing JVs and partnerships, JV CEOs and management teams, and dealmakers negotiating JVs and partnerships. In this role, Gerard seeks to ensure that these groups help to address their members’ key issues.

Recent Posts

Running for the Exits: Getting Joint Venture Exit Right

By Gerard Baynham | Tuesday, October 20, 2020

JOINT VENTURE (JV) EXIT is a key issue for dealmakers and corporate executives whose portfolios contain material JVs spanning the globe.

One way or another, companies eventually exit their JV investments – sometimes sooner than expected. Recent analysis of JV lifespan data shows that newer vintages of JVs are undergoing exits more quickly than in the past. For example, JVs formed from 1985 to 1989 tended to last about 15 years, while those formed from 2005 to 2009 lasted only 6 years (Exhibit 1). This contributes to a high volume of exits.

Read More

Valuation of Joint Ventures: 4 Steps to Handling Hard-to-Value Contributions

By Gerard Baynham | Thursday, May 30, 2019

COMPANIES ROUTINELY FIND themselves in painful joint venture negotiations, reaching “walk-away points” and failing to close deals because of hard-to-value contributions, differences in key assumptions, or valuations that do not support the desired ownership or control split. Relief lies in a paradox: While JVs often introduce more complex valuation challenges than other transactions, the flexibility inherent in JVs simultaneously offers dealmakers a range of techniques “to take valuation issues off the table” or otherwise help the counterparties get to yes.

Read More

Listening vs. Hearing in the Joint Venture Boardroom

By Gerard Baynham | Tuesday, August 8, 2017
MOST MEMBERS OF JV MANAGEMENT TEAMS lack the listening skills needed to successfully navigate JV Board discussions. It’s not that JV management teams are worse listeners than the rest of us. Far from it. Rather, it’s that the need to listen is greater, and the communication signals are often more muted and harder to hear to the untrained ear, when in a JV Board environment.

Consider a large purchasing JV in which management continued to pitch to the Board what management considered to be an eminently reasonable acquisition, not realizing that the Board was still unsure of the JV’s strategy upon which the acquisition’s logic was based. In a financial services JV, Board agendas were structured to showcase each department, with the end result being a parade of PowerPoint presentations from each member of the management team, with limited time for Board Directors to ask questions. Board members provided subtle hints that they wanted more strategic discussion, but management continued to charge forward, presenting page after page. Similarly, in a natural resource JV, management failed to connect the dots when a Board member asked for further study of a proposed capital investment. They did not realize that the Director was actually not supportive of the investment, but did not say so directly because it may trigger a discussion about conflicts of interest as the Director’s company was expanding its own capacity in the region.
Read More

The Joint Venture CEO Success Equation

By Gerard Baynham | Tuesday, March 21, 2017

WE HAVE SAID IT BEFORE: Being a JV CEO is one of the toughest jobs in modern business. Not only must JV CEOs handle all the classic challenges of running a company – often in fast moving, emerging industries and markets – but they must also deal with a set of issues that emanate from the unique ownership structure of a joint venture. By definition, joint ventures have multiple owners, and these owners often have some level of operational interdependence with the venture, and often have imperfectly aligned financial and strategic interests, corporate cultures, and expectations.

Read More

The Basics: Why Alliances Underperform and Fail

By Gerard Baynham | Tuesday, November 1, 2016

THE ROSTER OF NON-EQUITY ALLIANCE success stories is diverse and eye-catching, and includes Accenture-Cisco, Pfizer-Amgen, Starbucks-Barnes & Noble, and KLM-Northwest Airlines (Exhibit 1). But step back from these bright lights, and the truth is darker. Over the years, there have been many different studies on the success rates of alliances – some by us, many by others. Each asks slightly different questions and has slightly different results. But, on average, the odds of being happy with an alliance are no better than a coin flip, and few are without their headaches.

Read More

Six Practices for Managing Country Risk in Emerging Markets

By Gerard Baynham | Tuesday, June 28, 2016

AS CROSS-BORDER partnerships and investments become increasingly important for major corporations combating slow growth and depleted resources in their traditional markets, so too has the need to manage country risk in emerging markets. Many of the largest U.S. and European companies already receive 20 to 40% of their sales from joint ventures with foreign partners, a figure that is likely to rise. Royal Dutch Shell, Vodafone, and General Motors have significant portions of their portfolios committed to joint ventures in emerging markets.

Read More