James Bamford

Jim is a co-founder of Water Street Partners, where he serves a global client base across industries on joint venture issues. He has supported more than 200 joint venture transactions and restructurings during his career, and has worked extensively on JV governance, organizational, and commercial matters. Prior to Water Street, he co-led the Joint Venture Practice at McKinsey & Company.

Recent Posts

Governing a Portfolio of Joint Ventures: How Do You Measure Up?

By James Bamford | Monday, December 21, 2020

A DECADE AGO, we established a set of objective tests to allow companies to calibrate how well they are governing their portfolios of joint ventures. At the time, many companies were waking up to the materiality, risks, and untapped performance potential of their joint ventures, especially those that the company did not operate or control. Major HSE incidents at Macondo and Samarco – both joint ventures – and a series of high-profile bribery and corruption scandals and partner litigation further elevated the appreciation for risks in joint ventures in ensuing years. To this day, our Standards of JV Portfolio Governance Excellence remain the only tool for companies to independent-ly calibrate themselves against peers on the journey to excellence.1

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Joint Venture Governance Index: Calibrating Joint Venture Governance Strength

By James Bamford | Monday, November 9, 2020

TWELEVE YEARS AGO, we co-authored with CalPERS a set of guidelines for joint venture governance.1 At the time we argued, and still believe, that good governance in joint ventures strongly correlates with sustained financial performance, sound management of risks, and the ability of JVs to adapt to the changing needs of the market and their shareholders. We have asserted that joint venture governance is pound-for-pound more ‘physical’ than corporate governance due to the unique nature of a joint venture’s relationship with its shareholders.2 And while the number of shareholders is far more limited in JVs compared to those of public companies, the interests of the shareholders in JVs are more expansive, dynamic, and prone to conflict – which ultimately makes joint venture governance proportionately more demanding and consequential.

To bring greater transparency into how well joint ventures are governed – and to help investors, owner companies, joint venture boards, and individual JV directors calibrate the strength of the governance of ventures they own or have been appointed to oversee – we have developed a Joint Venture Governance Index. Like corporate governance indices, it defines a set of testable standards for governance that predict performance, and helps boards and other stakeholders calibrate where they are relative to objective standards of governance excellence, peers, and their own historic performance.3 Unlike corporate governance indices, however, the Joint Venture Governance Index is structured to address the unique governance demands of joint ventures – a highly-material class of businesses susceptible to shareholder misalignment, board over-reach, and other ills derived from the nature of the joint venture ownership structure.4

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Shareholder Representatives in JVs: Legal Proxy, Accountable Executive, or Muddying Interloper?

By James Bamford | Wednesday, May 27, 2020

IN CERTAIN INSTANCES, a company will appoint an individual to serve as its “Shareholder Representative” to a joint venture. The basic premise is that the Shareholder Representative is expected to act as the company’s agent with regard to the venture – a role that is empowered but not necessarily limited to signing agreements, amendments, consents, and waivers between the company and the other shareholders and/or the joint venture entity. Although it is not common in all industries, having a designated Shareholder Representative is fairly prevalent in natural resources companies.

Fundamentally, the purpose of the Shareholder Representative is to establish organizational clarity for making legally-binding commitments between the company and other JV parties. A related purpose is to establish legal separation between the company, as a shareholder in the JV with its own interests, and the executives it has appointed to serve as Directors on the JV Board, who will have fiduciary duties to that entity.

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How Due Diligence Differs for M&A and Joint Venture Deals

By James Bamford | Thursday, July 18, 2019

JOINT VENTURE AND M&A due diligence are superficially similar. Both follow the same basic process, starting when a preferred counterparty is identified and confidentiality agreements are signed, and usually concluding just prior to the signing of definitive agreements.  Both use similar advisors to investigate similar topics: Accounting firms lead financial due diligence; industry specialty consultancies perform parts of technical and operational due diligence; law firms drive legal and compliance due diligence. And both serve the same core purposes: To confirm that the company is getting what it expects from the counterparty, and to more deeply understand the counterparty’s assets and capabilities to inform transaction choice and key deal terms.

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Strategy Under Scrutiny

By James Bamford | Tuesday, April 30, 2019

IN MANY JOINT VENTURES – including those in semiconductors, financial services, media, healthcare, and natural resources – the owners are also the JV’s customers, channel, suppliers, users, or otherwise actively participate in the same markets as the venture (Exhibit 1).

Intel, Samsung, and AMD all own shares in semiconductor manufacturing joint ventures where, as owners, they are the JV’s major and sometimes only customers. Banks like JP Morgan Chase, HSBC, and Credit Suisse have all been part of joint ventures to develop and operate advanced technology and transaction processing platforms where success hinges upon owner adoption of the JV’s products or services. Mining companies like Rio Tinto and Anglo American routinely find themselves in JVs that are geographically proximate to their owners' wholly-owned infrastructure or operating assets, creating the potential synergies and conflicts. And oil companies like BP, Chevron, and ExxonMobil are all in JVs that are so financially material that they as shareholders have a fiduciary duty to deeply understand the venture’s strategy, market assumptions, performance, and financial controls.

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Financial Modeling for Joint Ventures: The Total Venture Economics Approach

By James Bamford | Tuesday, April 16, 2019

EARLY RESULTS OF OUR recent study on how companies perform across different aspects of the JV dealmaking process has revealed fairly pedestrian performance all around, with critical gaps across key functions within core JV transaction workstreams. With respect to financial modeling, for example, we find that companies struggle to create a dynamic model of what we call “Total Venture Economics.” And since a complete picture of Total Venture Economics is needed to dynamically and deeply inform negotiations regarding partner contributions, JV valuation, service pricing, and other economically driven deal terms, it is no surprise that the dealmakers we surveyed also reported dissatisfaction with their ability to structure those terms – especially those related to partner contributions to the JV (Exhibit 1).

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