NEGOTIATIONS CASE ANALYSIS
NEGOTIATIONS CASE ANALYSIS Negotiations Case Analysis Introduction Negotiation performed between two or more than two individuals or groups. In the given case, CMI and CTS are the two companies. Negotiation’s primary objective is to satisfy both (or all) the parties involved in the process of negotiation. In this case, the objective of CTS is to get acquired, and CMI aims to acquire CTS too. All the parties involved in the negotiation aim to satisfy their interests during the dialogue of negotiation (Van, De Dreu & Manstead, 2004).
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Discussion Financial Findings The financial findings of the merger between CMI and CTS show that CMI has a udget approved which is more than what CTS’ owners are asking for. Whereas, Randall is striving enthusiastically to give the lowest possible price so as to purchase CTS. In order to, completely acquire CTS at a reasonable price; CMI does not want to spend more than $600,000 along with the book value of CTS. As per Randall CTS’s worth is around $625,000.
Though CMI’s parent company has approved a budget of nine million for the acquisition. Resistance points from CTS The resistance points that CTS have are that the offer of CMI is very low, and CTS is demanding more than its actual worth. As CTS are striving in order to get a favourable offer from Randall’s side. Secondly, of CTS has to satisfy their concerns regarding their ownership stake after the complete acquisition. As they want to ensure their returns, which can only be possible, if they have a partial ownership in the new company.
Another resistance point is that CTS’ owners do not want to sell at a lower price or to a company that cannot give decent return; this is due to the owner’s investment in the company. Direct and Indirect Stake Holders The direct stake holders in this merger are CTS and CMI. CMI as per Frank Randall ants to expand itself as a residential real estate financial services company by acqulrlng c IS. I ne alrect stake n010ers 0T c IS are Its owners as tnelr Investment invested in the company from which they are expecting returns.
Furthermore, the employees of CMI and CTS and their shareholders are also the direct stakeholders in the acquisition scenario. Indirect stakeholders are Verico Mortgage Brokers Network and the parent company of CMI that is Metro Net. CMI needs to fulfill the MetroNet’s approved and proposed vision. Because, Osgood seemed concerned regarding the long-term viability and health of MetroNet. Types of power exhibited by each company CMI and CTS have used different approaches to exhibit their power in the negotiation phase.
These include two approaches. CTS are using the advocate’s approach to sell their company for as much price as they can get. Whereas, CMI is using the new- creative approach by highlighting the advantages of acquisition to CTS (Lewicki, Saunders, Minton & Barry, 2003). CMI through their exhibition of power wants to diversify their financial services capabilities, and rebuild their business by building a network that is strong enough to rival Lynch…