Negotiation Skills in M&A Transactions

Transcription

1 Negotiation Skills in M&A Transactions This course is presented in London on: 16 November 2018, 15 March 2019, 21 June 2019, 1 November 2019 This course can also be presented in-house for your company or via live on-line webinar The Banking and Corporate Finance Training Specialist

2 Course Objectives Participants will: Be introduced to the typical negotiation roles and the experienced negotiators know how to switch roles depending on the situation Get an overview of the negotiation process in multiple stages such as the preparation, planning and the bargain Have explained to them the ten fundamentals principles to negotiation techniques in M&A and Course the six Overview rules of influence: reciprocation, scarcity, authority, commitment, liking and consensus Master the BATNA (Best Alternative To a Negotiated Agreement) Be taught about Zero-sum fallacy is a situation in which a participant's gain (or loss) is exactly balanced by the losses (or gains) of the utility of the other participant(s) Course Content Negotiation Personalities Typical negotiation roles include: The leader is generally the negotiator with the most experience The good guy is the person with whom most of the members of the opposing team will identify The bad guy attempts to make the opposition feel that the agreement could stall any minute The hard liner takes a tough line on everything The sweeper picks up and brings together all the points of view expressed and then puts them forward as a single coherent case Experienced negotiators know how to switch roles depending on the situation Negotiation Process All negotiations, consciously or unconsciously, go through a number of logical steps Stage 1: preparation and planning Objective building and fact finding Collecting the evidence (organising the facts) Stakeholder analysis (identifying the key decision makers) Position perception Stage 2: enquire and test assumptions Build rapport & create a positive environment Avoid hostility under all circumstances Stage 3:propose Let the other party make the first proposal Deliver your proposal with little emotion Never offer your final position at the start Aim high whilst being reasonable Stage 4: bargain Trade concessions rather than just make concessions Avoid irritators and overly frequent counter-proposals Stage 5: close Avoid defend-attack spirals Provide a feelings commentary Avoid argument dilution

3 M&A Negotiation The ten fundamentals principles to negotiation techniques Set maximum and minimum objectives Keep analysing the deal variables Always aim high Never give a concession always trade it Keep the whole relationship in mind Know when to walk away from a deal Know the negotiation process Have a BATNA (Best Alternative To a Negotiated Agreement) Select an effective negotiation strategy Change your strategy if necessary but never change your BATNA The six rules of influence: reciprocation, scarcity, authority, commitment, liking and consensus BATNA Before the negotiation, decide what you will do if nothing comes of the negotiation Unless you have a plan B, your anxiety may reach dangerous levels BATNAs set the threshold in terms of the full set of interests that any acceptable agreement must exceed Both parties doing better than their BATNAs is a necessary condition for an agreement Zero sum fallacy Zero-sum fallacy is a situation in which a participant's gain (or loss) is exactly balanced by the losses (or gains) of the utility of the other participant(s) Final Case Study Introduction The participants are split into two groups, a buyer (a multinational company) and a seller (a private equity firm) The key focus will be on negotiating and executing deals smoothly and correctly to the best interest of the parties while arriving at an acceptable solution for both parties The participants will role-play the M&A negotiation in two rounds Final Case Study Round I The seller has been running a competitive process and has received non-binding offers from several parties One of the buyers is trying to obtain an exclusivity and has asked for a meeting with the seller to discuss their bid and the key clauses of the SPA. Final Case Study Round II The interested buyer has been granted exclusivity and is negotiating the detailed clauses of the SPA including: The price adjustment mechanism: locked box vs. completion account An earn-out or deferred payment structures The potential adjustments to working capital and capex The representation & warranties and related indemnities A pro or anti-sandbagging provision A MAC clause

4 Background of the Trainer The trainer has 15 years of experience in accounting and investment banking at leading firms and is an experienced financial trainer who has delivered courses for financial institutions in the City of London and around the world, in the areas of Corporate Finance, Valuation (Industrials and Banks), Financial Modelling, M&A, LBO, Financial Accounting, Capital Markets, Bank Regulatory Capital, Financial Risks, both in English and French. Course Summary Course Description This course has been developed to provide mid-level and senior professionals involved in M&A transactions (advisors, lawyers, accountants, financing professionals, corporate development professionals, integration managers etc) with the key soft skills to negotiate and close a sell-side or buy-side transaction in a structured and uniformed approach. The trainer will discuss the main negotiation techniques, including reciprocity, BATNA and trading concessions. The participants will then role play in separate groups on an M&A case study with participants playing buyers and sellers. During the role play, the key clauses of SPA are discussed including the lock-box and completion accounts mechanisms, representations & warranties, etc. Course Methodology The course will be delivered in a highly interactive, participative way, involving many activities and exercises, thereby ensuring maximum learning and integration of the learning points into the workplace, when the participants return to their daily roles. What Redcliffe s clients are saying about the course: The role playing and trainer s presentation of the course were excellent. --KPMG Practical examples of negotiations with a mix of theory and application. --Business Analyst, CVS Useful theory regarding negotiating approaches. Useful case study as well. --Manager, UBM

5 09:30-17:00 London Standard Price: 625 +VAT Membership Price: VAT In-House Training Delivering this course in-house for a number of participants could be very cost effective. The venue and timing can be agreed to suit the client, as well as the selection of the trainer and the precise contents of the seminar. Tailored Learning All of our training courses can be tailored to suit your company s exact training needs. We will work closely with you to help develop a training programme with content that is unique for your organisation. Please us on enquiries@redcliffetraining.co.uk for more information E-Learning This course can also be presented as a bespoke e-learning programme created by you to fit your exact requirements.