Negotiation tactics on M&A?

This topic contains 4 replies, has 5 voices, and was last updated by  Hari Pandiyat 2 months, 2 weeks ago.

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  • #114945

    JIANXIANG CHUA
    Participant

    Seen somewhere from the slides that negotiation is the key to closing the deal. Any tips on negotiation tactics from a buy-side and sell-side?

    #114996


    Participant

    Hi Jianxiang,

    From personal experience of buy side, I think the best way to negotiate is by getting to know your target more from a personal perspective, this tends to reduce the amount of friction created as the seller then doesn’t see you as an aggressor and it then becomes easier for them to concede ground in negotiations.
    I’ve found that if you negotiate aggressively, it tends to end conversations very quickly.

    #115196


    Participant

    From the sell-side, it is always good to know what are the alternatives available to your company and how much you are willing to compromise before calling it a no deal. It is also important to find out more about your acquirer and the decision makers through getting to know them on a more personal level if possible as this would also affect top level integration post acquisition.

    #115206


    Participant

    This is an aspect I need to understand more. But from a role-playing exercise I saw during a dealmakers conference, it seems that specialist lawyers often play a significant role in terms, particularly non-financial, including establishing boundaries on non-compete covenants.

    #115683

    Hari Pandiyat
    Participant

    It is most important to know what your counterpart really interests are. Then only we can play out our concession cards better.
    You need to make the other party well aware that you are giving something of value and understand how they would reciprocate on the same. If there is an element of trust issue regarding the favor other party would do, better to keep a contingent concession in the agreed terms and conditions.

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