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Preparation is the key to success
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Define objectives
WHAT ? WHY? HOW? WHO? WHEN?
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Identify key issues
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Understand your bargaining power
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Put yourself in the other party’s role … investigate the other party
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Fix time frame
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Decide on what you must have from the deal
X X
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Decide on what you are willing to compromise on
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Fix your boundaries for walking away from the deal …i.e. what is definitely not possible
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Think of a negotiating strategy
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Select your negotiating team with care
Think of the next steps, post deal
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Planon the documentation, have a draft document in place prior to negotiation
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Practicethe negotiating strategy with your team
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IN SUMMARY
Prior to negotiations, it is important to be prepared with the following:
What you want from the proposed transactions
Transaction/deal maker issues Transaction/deal breaker issues What is the point where you are
prepared to walk away 16www.bizkul.com
IN SUMMARY Try to put yourself in the other party’s
shoes to understand their interests in the proposed transaction
Consider factors which may be relevant to transaction, either in terms of the valuation, deal structuring and/or such factor which may need to be factored in
Consider legal and regulatory issues that may be relevant, for example warranties and representations in documentation 17www.bizkul.com
IN SUMMARY
Keep a checklist of the factors you consider important, prior to the negotiations
Decide on the team members who will negotiate
Who will be your key negotiator(s) Will you plan to have different
persons handling specific questions
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IN SUMMARY
Decide on the negotiating strategy you want to adopt
Will you have your advisors with you to participate in the negotiations
What are the questions you plan to ask, how will you formulate questions – mind your language . . .
What are the expected questions and how you can answer them
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IN SUMMARY How will you prepare to listen to
the other team, listen to the articulated demands and the unarticulated ones
How will you plan to handle potential breakdown situations where negotiations are reaching a stalemate
Prepare with a role play if you so desire 20
Good luck in your role play
andreal life
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