1. 1 M & A Example: Single Issue Analysis  Client was negotiating a joint venture with a “counterparty”.  Issue: The value to be attributed to the Client’s contribution to the joint venture, expressed as the percentage share of the joint venture it would own.  Client wanted 60%.  Client feared the counterparty would agree to only 45%.  At the counterparty, there were three partners. Two of the partners would need to be in agreement for the deal to proceed. The deal was very important to these partners.

2. 2 Data Collection: Stakeholders List of Stakeholders Partner 1 at Counterparty Partner 2 at Counterparty Partner 3 at Counterparty Client CFO Client Line Manager Client’s Bank Advisor

3. 3 Data Collection: Potential Influence List of Stakeholders Potential Influence Partner 1 at Counterparty 80 Partner 2 at Counterparty 100 Partner 3 at Counterparty 25 Client CFO 100 Client Line Manager 20 Client’s Bank Advisor 40

4. 4 Data Collection: Salience List of Stakeholders Potential Salience Influence Partner 1 at Counterparty 80 70 Partner 2 at Counterparty 100 90 Partner 3 at Counterparty 25 50 Client CFO 100 30-40 Client Line Manager 20 75 Client’s Bank Advisor 40 70

5. 5 List of Stakeholders Potential Salience Negotiating Influence Position Partner 1 at Counterparty 80 70 30% Partner 2 at Counterparty 100 90 50% Partner 3 at Counterparty 25 50 30% Client CFO 100 30-40 70% Client Line Manager 20 75 75% Client’s Bank Advisor 40 70 85% Position as to Client’s % Ownership

6. 6 Base Assessment  “Base Assessment” suggests agreement will be reached after 3 rounds of negotiation at 50% ownership.  The partners of the Counterparty and the Client CFO are willing to reach a compromise in the third round. The Client line manager is unhappy with the chosen outcome.

7. 7 Negotiation Opportunities Identified  The model indicates that Client’s Bank Advisor has more influence than he realizes with Partners 1 and 2 of the Counterparty.  In the third round, when the Client’s CFO believes that 50% is the best outcome available, the Advisor has the opportunity to intercede and persuade Partners 1 and 2 to accept a more favorable outcome (up to 75%).  Partner 3 is unlikely to move as far as 75%, but will not veto the result.

8. 8 PotentialSalience Negotiating Influence Position Partner 1 at Counterparty 80 70 30% Partner 2 at Counterparty 100 90 50% Partner 3 at Counterparty 25 50 30% Board Member 85 60 30% Client CFO 100 30-40 70% Client Line Manager 20 75 75% Client’s Bank Advisor 40 70 85% Impact of New Data Following the initial analysis, the Client became aware of a new stakeholder (a Counterparty Board member) who was actively advocating only 30%.

9. 9 Revised Conclusions  Base Assessment: The model identifies that this new stakeholder poses a real risk to completing the deal. He, Partner 1, and Partner 3 will likely come together to kill the transaction.

10. 10 Revised Conclusions  Opportunities: The Bank Advisor still has influence with Partners 1 and 2. If the Bank Advisor talks to them in Round 1. This results in a coalition at 60%.  The Client achieved this 60% target.