M&A Negotiations: Do it Like a Golden Eagle (Part 3)

In M&A negotiations, having vast home range and multiple nest sites is a complement to panoramic view, prey focus, and opportunity orientation. In this post I deal with this last important concept of the golden eagle strategy regarding M&A negotiations.

Vast Home Range of M&A Negotiations

As mentioned before, negotiations require plans and actions that should be taken accordingly. Planning is your best tool to manage the future and reduce the risks in any business platform.

In every M&A negotiation process you have to manage your future and in order to do it well, you need plans and strategies to implement your plans. Vast home range is the last part of the golden eagle strategy that leads you to a better planning of the future and managing it wisely. So, if you want to be a golden eagle negotiator you have to consider vast home range as well. 

The Power of BATNA

Harvard Business Review introduced BATNA, which stands for “Best Alternative To a Negotiated Agreement”. I have previously discussed vast home range and the importance of having multiple nest sites just as the golden eagle does. The vast home range is completely coherent with BATNA, or better to say, BATNA is one of the approaches of vast home range.

When you plan for the negotiations you have to contemplate BATNA, which varies for each case. BATNA can be negotiating different deals at the same time, walk-away, changing your business approach, etc. In other words, BATNA can be your plan B in the negotiation and the plan B of your business concept can be a BATNA in the M&A negotiations.

If you plan and manage your BATNA well, you can leapfrog a pitfall in negotiations, which is one of the Porter’s five forces: the bargaining power. No matter which side of the table you sit, your BATNA and the other party’s BATNA can balance the power and may lead you to close the deal.

The Third Parties and Viewpoints

The internal meeting of the company is a helpful tool for you to get more ideas and viewpoints on the deal. So, always make sure to have brainstorming sessions and get as many ideas as you can during the process. Furthermore, the use of external auditors and consultant is a must for the M&A negotiations in the whole process. The ideas out of your own company will manage your objectivity and you get much better ideas than consulting internal employees who are overwhelmed with your own business activities.

Finally, third parties in the negotiations play a vital role in the contemporary business platform. They maybe brokers or consultants and their job is to make sure that the deal is going on the track and the win-win situation is followed by both parties.  One major issue with the third party is that they should be really working as a third party and not a messenger or connector. Make sure to get them involved in the whole process. Once, I have experienced a deal that the third party was acting just as a messenger and nothing more and the CEO of the company made it so. The use of third party in that case was so much deteriorated that even the two parties did not make any face-to-face negotiations when it was essential. It is usually up to you to use the third party wisely and make sure the third parties do not have an adverse impact on the negotiations deal.