Pinnacle Machine Tool Company
Don Anglos had to decide whether to trust his gut or his head, and he had to make that decision by next week’s board meeting. Either way, he knew he was bound to make at least a member or two of his senior management team unhappy. The question at hand was whether Pinnacle Company, the small, publicly held Indiana-based machine tool company he led as CEO, should attempt to acquire Hoilman Inc. Hoilman was a company known for the cutting-edge sensor technology and communications software it had developed to monitor robotics equipment. Anglos had just heard a credible rumor that one of Pinnacle’s chief competitors was planning a hostile takeover of the company. Coincidentally, Don Anglos knew Hoilman well because he had recently held exploratory talks about the possibility of a joint venture designed to develop similar technology capable of monitoring a broad range of manufacturing equipment. The joint venture did not work out. But now, by acquiring Hoilman, Pinnacle could develop software that transmitted real-time information on its customers’ equipment, enabling it to set itself apart by providing top-notch service far more sophisticated than its current standard maintenance and service contracts. Don, a hard-working 48-year-old, firmly believed that bigger was better. It was a premise that had served his Greek immigrant father well as he built a multimillion-dollar business from nothing by acquiring one commercial laundry after another. The CEO had to admit, however, that getting bigger in the machine tool industry, currently a slow-growing sector facing increasing competition from low-priced foreign manufacturers, was going to be a challenge. Still, he had been convinced to sign on as Pinnacle’s CEO four years ago not only because the company had relatively healthy earnings, but also because his sixth sense told him the company had