Applied Mergers and Acquisitions Workbook by Robert F. Bruner

Applied Mergers and Acquisitions Workbook by Robert F. Bruner

Author:Robert F. Bruner
Language: eng
Format: epub
Publisher: John Wiley & Sons
Published: 2004-03-13T16:00:00+00:00


CHAPTER 30

Negotiating the Deal

The bargaining entailed in designing the agreement to merge or acquire can have a material influence on the outcome. Success in M&A is not determined solely by excellent analysis. One must also master the processes of negotiation by which deals are obtained. This chapter outlines some of the considerations in setting a negotiating strategy for the deal.

To prepare for a merger negotiation: Assess the current strategic position and alternative strategic actions for buyer and target.

Value the target using a variety of approaches.

Explore your best alternative to a negotiated agreement (BATNA).

Decide on an opening and a reservation price—these bound the range in which you aim to settle on price.

Identify the relevant players and their interests.

Anticipate trade-offs.

Consider motivations and aspirations.

Work through possible negotiation scenarios in advance.

Assess the impact of bargaining costs.

Check the reputation of your counterparty.

Reflect on persuasion, its sources, and its impact.



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