Merger Negotiations – Keys to Success

Business mergers are an integral part of operating in the national and global marketplace, and there’s a strong chance that you’ll experience them at some point.  Once that they become a possibility, merger negotiations become a vital part of completing a merger.  These negotiations help ensure that both sides are content with the deal, and it’s important to know the basic keys to success at merger negotiations.  No two negotiations will be the same, but these principles will apply to practically any acquisition or merger.  Keeping them in mind before and during the proceedings will help ensure that the process goes as smoothly as it possibly can.

First of all, and most importantly, do your research.  You need to review all aspects of a company to ensure that an offered price is fair.  This includes looking at the history of a company, their financial information, future projections, and any other attributes that are associated with its value.  Merger negotiations hinge on a fair price and both sides will be well advised to do their research into this.  If you can time a merger properly, it will go even more smoothly since both sides will be more motivated.  This could be at a turning point in a company’s future, for better or for worse.

You’ll also want to ensure that any conflicts of interest are avoided since these can cause serious problems with most merger negotiations.  This goes for personal conflicts within the different people involved in negotiations as well as in any issues with the big picture.  Finding stakeholders who are open to the possibilities of a merger is important as well.  And be sure that you consider utilizing negotiation professionals and even mediators to assist with negotiations that run the risk of being difficult, complex, and stressful since they can help alleviate tension.

Finally, stay focused.  Even if merger negotiations seem to be reaching a close, the deal isn’t finalized until all is said and done.  Vigilance is vital and your merger team will need to keep their eye on the prize until the final signature is on paper.  If you keep these key elements in mind, your merger negotiations will be much more successful.  It starts with diligent research, but there is obviously much, much more to it than just that.  Take the time to learn all that you can about both companies and about the process, and success isn’t too difficult to attain.

About Richard Wilson