At this stage, for all intents and purposes, Malone IS iiNet. To other major shareholders in the business, iiNet's customers, its staff, stakeholders and suppliers, iiNet is a company focused around one man, with a certain degree of control devolved into a couple of key lieutenants who are also inseparable from Maone himself. In other words, if Malone set out to block a takeover of iiNet '¦ it is very possible that he would succeed, no matter what other factors were involved.
Furthermore, there is substantial reason to believe that Malone would indeed block most takeovers of iiNet.
If you meet Malone in person, it's easy to be struck by how incredibly engaged in his company's affairs he still is, despite having run iiNet for almost twenty years now. On one memorable occasion, after iiNet's initial court victory against AFACT in February 2010, we interviewed Malone in iiNet's Sydney offices.
At that stage, the executive was the very picture of a young (we believe him to be in his early 40'²s) leader; he knew the names of low-level staff around him, he was touting an iPhone and swallowing gulps from an energy drink, speaking excitedly and at length about the fantastic future of the telecommunications industry.
Hardly the picture of an executive who would simply roll over and let a larger company acquire the ISP he has built from the ground up. In fact, we would expect Malone to greet most acquisition offers for iiNet with laughter and a request for the price to be doubled '” and even then he might not consent to a sale.
Yes, the only way to arrange to buy out iiNet in a way that would be reasonably assured would be to go around Malone in the first place. Speak to iiNet's other major shareholders behind closed doors. Get them on board with an offer amount which would be high enough to ensure they were more than sufficiently incentivised to weather any turbulence. And then embark on a massive marketing campaign to sell the deal to iiNet's retail shareholders as a hugely synergistic play when the planned buyout was finally revealed in public.
In short, the only way to get around iiNet's Godfather and get an acquisition across the line would be to present Don Malone with a fait accompli '” a deal so good that there would be no way for him to turn it down.
Like Corleone himself, Malone has proven himself over the years to be a man of strength and integrity. The only way to get him on board for an acquisition will be to make him an offer '¦ that he cannot refuse.
Image credit: iiNet
