What Role Does an M&A Advisor Play in Negotiations?

During negotiations, a third-party M&A advisor acts as a buffer between buyer and seller. As you can imagine, negotiations can become quite intense and emotional on both sides and we want to do everything in our power to preserve a harmonious relationship between both parties. Having a good working relationship with the seller is important, especially for many strategic acquirers who want leadership to stay on after closing.

As M&A advisors, we guide our client through the M&A process — helping them address questions and concerns the seller may not be comfortable sharing with the buyer, who will be their future boss. We help diffuse tension when the two parties don’t see eye to eye. As advisors, it’s our role to shield clients from emotional exchanges so that no bad feelings linger when the deal closes. In one particular transaction, the seller asked for more money after all parties had agreed to the price. When we called to tell him that the buyer, our client, would not be changing their offer, he hung up on us. Fortunately, the deal still went through and everyone was happy with the end result.

In addition, because we have experience working through hundreds of acquisitions, we are able to move the deal forward. Nothing kills a deal like lack of momentum. If you drag a deal out for too long people start getting cold feet or circumstances change. Inexperienced sellers (and buyers) can spend a long time deliberating simple facts and negotiating in circles because they lack confidence and the necessary expertise. With a trusted advisor by your side, you will have the confidence to take the next step forward.

Photo Credit: Michigan Municipal League via Flickr cc

Leave a Reply

Your email address will not be published.