This entry simply demonstrates the rewards to be gained through an open and collaborative relationship between a treasury team and its chosen banking provider.

The challenge:

Following the announcement in 2014 that Cerner Corporation would acquire Siemens Health Services from Siemens AG for $1.3bn, the challenge was to integrate the banking arrangements of the two businesses quickly and seamlessly.

Cerner’s legacy processes operate via straight through processing, from ERP via SWIFT to the bank, and vice versa. Ideally, the treasury set-up would allow the acquisition to be integrated into the existing processes from day one from a collections and payments standpoint.

Ultimately, this meant that the three-strong treasury team needed to open 16 new accounts across multiple jurisdictions, work closely with the bank’s technology group to enable STP through SWIFT, and add half the accounts to an existing euro pooling structure. Since new entities were being formed, five countries required capital accounts, which had to be opened within four-six weeks of bank selection to meet legal requirements. The original deadline for the operating accounts, the date the acquisition closed, was accelerated by two weeks, late in the project, to allow for client communication for electronic payments and the transferring of funds into new entities to adhere to regulatory requirements. Given the significant challenge and tight timeframe, Cerner Treasury developed a contigency plan, just in case everything didn’t work perfectly.

The solution:

Using the acquisition as a catalyst, Cerner took the opportunity to issue a request for proposal (RFP) for transaction services across Europe and India. Cerner worked with Bank of America Merrill Lynch to put in place a range of services across the transaction services sector, including capital accounts for new legal entity registrations, cash and liquidity management, foreign exchange services and a global T&E card programme.

In fewer than four months, the Cerner treasury team managed a successful RFP process, mandated Bank of America Merrill Lynch for the expanded business and opened 16 accounts in 15 different jurisdictions – all without missing a deadline.

The acquisition was closed on 2nd February 2015, and by late January, when the team needed to have all the new accounts in place, connected to online banking and linked to the cash pool they were already operating with Bank of America Merrill Lynch, everything was operational. On completion day, the purchase amount was paid from within the new banking structure.

The historic relationship developed with Bank of America Merrill Lynch made the integration of the new acquisition smooth from a timing, cost and KYC perspective.

Best practice and innovation:

The three person Cerner treasury team managed an RFP process and integrated a new acquisition, all against a tight timescale of 3 ½ months, and never missed a deadline. This was achieved by close co-operation with Bank of America Merrill Lynch, calling on a level of trust built up over many years. The historic relationship developed with Bank of America Merrill Lynch made the integration of the new acquisition smooth from a timing, cost and KYC perspective.

As Beth Hull, Treasurer, recalls “the success of this project hinged on the close collaboration between treasury and bank and the willingness of both to be open and flexible throughout the process. This solution demonstrates the rewards to be gained through acollaborative relationship between a treasury team and its chosen banking provider.”