Allert Negotiating successfully

Negotiating successfully in small and mid-sized M&A transactions
1. Auflage 2015
ISBN: 978-3-86346-252-9
Verlag: Kuebler
Format: EPUB
Kopierschutz: 0 - No protection

E-Book, Englisch, 408 Seiten

As instruments of strategic company management they have become an indispensable
element of business life: "Mergers and acquisitions", meaning combinations
and takeovers of enterprises or parts of enterprises. How can such
transactions be negotiated in an effective and focused manner? There are extensive
theoretical negotiation models – but how can these be implemented specifically?
This book wants to make a contribution to transferring such theories to
day-to-day M&A negotiation practice. It conveys practical knowledge in order
to make negotiations for the purchase and sale of an enterprise more successful.
The focus is on the area which in Germany accounts for the majority of enterprises:
medium-sized companies. It is addressed to entrepreneurs, attorneys,
auditors and tax advisors as well as all corporate finance professionals who are
involved in negotiation situations. With numerous case studies from consulting
practice, Arnd Allert accomplishes the transfer of theoretical knowledge
to day-to-day practice. In this book, Arnd Allert has compiled his knowledge
from more than one hundred M&A transactions and gives an insight into the
world of M&A consulting which in this comprehensive form so far was almost
impossible to find.

Autoren/Hrsg.

Allert, Arnd

Weitere Mitwirkende

Knoblauch, Holger

Inhaltsverzeichnis

Preamble
Introduction
Structure of this Book
Acknowledgments
PART A
1. Negotiating in M&A Transactions
2. Theoretical Negotiation Models and their Transfer into M&A Practice
3. General Aspects of International Negotiations
PART B
4. Negotiation Issues in the M&A Process
5. Ethics in Negotiations
6. Outlook
List of References

Leseproben

List of figures

Figure 1 The M&A process flow, using the example of the sale of an enterprise

Figure 2 Selection of possible areas of conflict

Figure 3 The classic Lehman Formula

Figure 4 Different compensation combinations for M&A consulting services

Figure 5 Example of the economic development of a company

Figure 6 Model calculation for the continuation scenario (contribution to a foundation)

Figure 7 Model calculation for the liquidation scenario

Figure 8 Model calculation for the IPO scenario

Figure 9 Comparable companies – overview

Figure 10 Range of values in the IPO scenario

Figure 11 Sample comparison of alternatives for action

Figure 12 Schematic diagram of the creation of a ZOPA

Figure 13 Summary of theoretical negotiation principles

Figure 14 Selection of key factors influencing a negotiator in M&A transactions

Figure 15 Message - Sender - Receiver model

Figure 16 Domination, equality and subordination in transactional analysis

Figure 17 The 4 sides of a message

Figure 18 Occasion-related stressors in M&A transactions

Figure 19 The human brain

Figure 20 Hormones produced in the human brain

Figure 21 Ways of coping with stress in M&A transactions

Figure 22 Sphere of responsibility and sphere of influence

Figure 24 Redefinition of the sphere of responsibility and the sphere of influence by involving an M&A advisor

Figure 23 Maslow's pyramid of needs

Figure 25 The basic principles of the Harvard Concept

Figure 26 Potential liability risks I

Figure 27 Potential liability risks II

Figure 28 Potential liability risks III

Figure 29 Pay-off diagram of the prisoners' dilemma

Figure 30 Pay-off diagram of the negotiator’s dilemma

Figure 31 Problem areas of the application of cooperative negotiating

Figure 32 Example of a complex decision-tree

Figure 33 Example of a pay-off matrix

Figure 34 Terrified woman

Figure 35 Bids for drilling licenses

Figure 36 Results of an experiment conducted by the author with 1,000 rolls of the die

Figure 37 Results of an experiment conducted by the author regarding the aggregate number of pips in 1,000 rolls of the dice

Figure 38 Example of the economic development of a company

Figure 39 Definition of the expected value of the value drivers

Figure 40 Value drivers and likelihoods of occurrence

Figure 41 Risk simulation of a value driver with right-skewed distribution

Figure 42 Monte Carlo simulation of the terminal value with equal distribution

Figure 43 Income statement after conducting a Monte Carlo simulation

Figure 44 Determination of the enterprise value using Monte Carlo simulation

Figure 45 Division of the determined enterprise value in intervals

Figure 46 Analysis of the risk of a total loss

Figure 47 Value drivers and modified likelihoods of occurrence

Figure 48 Determination of the enterprise value using a Monte Carlo simulation with modified likelihoods of occurrence

Figure 49 Intuitive, competitive negotiation vs. rational, cooperative negotiation

Figure 50 Relevant factors in international negotiations

Figure 51 Influence of a country's culture on the negotiation style

Figure 52 Analysis of the motives in the course of the M&A process

Figure 53 Forms of conflicts of interest of seller and management

Figure 54 Incentives in the case of conflicts of interest between seller and management in M&A transactions

Figure 55 Interests of different groups of investors

Figure 56 Preparation of the longlist as next step in the M&A process

Figure 57 Identification of suitable target companies as part of the preparation of a longlist

Figure 58 Preparation of the information memorandum and other documents in the M&A process

Figure 59 Sample outline of an information memorandum

Figure 60 Sample outline of a financial factbook

Figure 61 Sample outline of a teaser – page 1

Figure 62 Sample outline of a teaser – page 2

Figure 63 Dependency of the valuation method on the quality of information

Figure 64 Stand-alone valuation, opportunities for increasing value and purchase price potential (without consideration of tax effects)

Figure 65 Complexity of determining value price

Figure 66 Merger model

Figure 67 Distinction between traditional enterprise valuation and valuation guideline

Figure 68 Present value concept vs. IRR concept

Figure 69 IDW's concept of functions

Figure 70 Overview of the most common valuation methods

Figure 71 Simplified reconciliation from enterprise value to equity value

Figure 72 Results of cashflow modeling and its effects on the value contribution of the terminal value

Figure 73 Arguments for enterprise values

Figure 74 Sensitivity analysis of the effects of different WACC and beta factors

Figure 75 Selection of a peer group

Figure 76 Rough calculation for the determination of the implied beta factor of a multiple

Figure 77 Various multiples and the corresponding length of distribution

Figure 78 Sample DCF analysis with implied multiples and sensitivity analyses

Figure 79 Selection of the sales process in the overall M&A process

Figure 80 Vickrey auction

Figure 81 First-price sealed-bid auction

Figure 82 English auction

Figure 83 Dutch auction

Figure 84 Summary of standard auction rules

Figure 85 Overview of the features of the different sales processes

Figure 86 Seller objectives in the selection of the M&A sales process

Figure 87 The perfect number of bidders

Figure 88 "Magic triangle" in the transaction process

Figure 90 “Handelsblatt Online”

Figure 89 Newspaper article in the Financial Times Germany of 9 July 2012

Figure 91 “Reuters Deutschland”

Figure 92 Comparison of negotiation and auction

Figure 93 Three elements of a negotiauction

Figure 94 Overview of offers – phase 1

Figure 95 Overview of offers – phase 2

Figure 96 Sounding & Approach in the overall M&A process

Figure 97 Risks and opportunities profiles of the basic merger strategy types

Figure 98 Exchange of first transaction documents in the M&A process

Figure 99 Management presentation in the transaction process

Figure 100 Stages of a management presentation

Figure 101 Example of an abbreviated investor profile

Figure 102 Success factors of a management presentation 1

Figure 103 Success factors of a management presentation 2

Figure 104 General motives of top decision-makers and matching features of the enterprise to be sold (example)

Figure 105 Feature-advantage-benefit table

Figure 106 Obtaining non-binding offers in the M&A process

Figure 107 Alternative courses of negotiation processes

Figure 108 Decision-tree for submitting a first, non-binding offer as a basis for further negotiations

Figure 109...

Über Autor(innen)

Arnd Allert has been working in the corporate finance industry for more than
20 years. He started his professional career at Deutsche Bank AG. In 2003, he
founded the M&A consulting firm Allert & Co. GmbH, which today is among
the leading consulting firms for mergers and acquisitions in Germany. In addition
to his consulting activities, he is lecturing at universities on the subjects
of "Mergers and Acquisitions" as well as "Negotiation" and, in addition, is a
member of several supervisory and administrative boards.