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LUU NGOC HAN THAO MY THU THANH THU TRANG HUYEN TRAM
NEGOTIATING DIFFERENT TYPES OF PROJECTS

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NEGOTIATING
DIFFERENT TYPES
OF PROJECTS
MERGER AND
ACQUISITION - M&A
TABLE OF
CONTENTS

Definition and Classification

Merger and Acquisition Negotiation

Necessary factors in M&A

Negotiation
 WARM UP
GAME
There are the companies which have merged and
bought back recently. Linking 2 company logos
which were acquired or merged that you know.

On October 9, Thaco Group of billionaire

Tran Ba Duong said that Emart Group
(Korea) and Thaco had completed the
transfer of Emart supermarket business in
Vietnam. According to Korea's Korean
Times, the fact that Emart Group sold its
entire retail business in Vietnam to Thaco
was because the company failed to expand
its business into the Southeast Asian
market despite great efforts.
M&A agreement between ThaiBev, one of the
leading beverage companies in Southeast Asia. It
is the largest beverage enterprise in Thailand.
With Saigon Beer - Alcohol - Beverage
Corporation (SABECO). The largest M&A deal in
Asia's brewing industry worth $4.8 billion in
ThaiBev's acquisition of a 53.59% stake in Sabeco.
This is a move to dominate the Vietnamese
market by the Thai "beverage giant", when Sabeco
is one of the most famous beer brands in our
country with 41% market share.
According to the new agreement reached with
General Motors (GM), VinFast will take over the
current system of authorized dealers of the
Chevrolet brand and become the exclusive
distributor of Chevrolet branded products and
services in the Vietnam market.
 Types and
What's Merger Motives of Merger
and Acquisition and Acquisition
Mean ?

DEFINITION
&
CLASSIFICATION

1 What are the

differences between
Merge and
Acquisition ?
WHAT'S MERGER &
ACQUISITION MEAN?
Merger and acquisition (M&A) is the
process through which companies
consolidate via acquiring or merging
with other companies, including the
acquisition of a company’s assets as well
as its equity.
 What are the differences between Merge and Acquisition?

Comparative criteria Acquisition Merger

A merger is an association between businesses of

Acquisition is a form in which a large business buys
Definition out smaller or weaker businesses
the same size and the creation of a new business,
new legal status

By determining the value of the merged company

No price specified the value of the acquired company
Valuation into shares that determine its value in cash
by how many shares of the merged company

The board of directors of the following merged

The board of directors of the acquired company has no
company when merging, the position is not equal
say and no power in the reorganization of the new
Operation company acquired
to the merged company.
After the merger, the merged company often loses

Legal consequences The purchased enterprise retains its old legal status Merged enterprises to form new legal entities
 TYPES OF M&AN
MEAN?
BUSINESS SECTORS PRIVATIZATION FRIENDLY OR JOINT VENTURE LEVERAGED
HOSTILE BUYOUT
Horizontal Private
Merger Public
Vertical Merger
Concentric
Merger
MOTIVES FOR MERGER AND ACQUISITION

Higher growth
Synergies
Horizontal integration
Vertical integration
Diversification
Tax benefits

2
MERGER AND ACQUISITION
NEGOTIATION
 KEY PARTICIPANTS IN NEGOTIATING MERGER
AND ACQUISITION
SENIOR/ OPERATING
MANAGEMENT
Providing strategic and tactical advice
Responsible for communicating its
preferences about how the acquisition
process should be managed, a timetable
for completing the acquisition, who will
be the “deal owner”.
LAWYERS
Structuring the deal, evaluating risk,
negotiating many of the tax and
financial terms and conditions,
arranging financing, and coordinating
the timing and sequence of events to
complete the transaction.
INVESTMENT BANKS
and acquisition opportunities; screening
potential buyers and sellers, making
initial contact with a seller or buyer; and
providing negotiation support, valuation,
and deal-structuring guidance.
ACCOUNTANTS
Advising on the most appropriate tax
and financial structures and on
performing financial due diligence. They
also prepare financial statements and
perform audits.

DEALING A
M&A
NEGOTIATION
IN REALITY

A product from group 4

LET'S START !!!
 3
NECESSARY FACTORS IN M&A
NEGOTIATION
 Building a Determining Searching for Evaluating
Communicating M&A Negotiated unnegotiated
working Underlying
Effectively across Options to alternatives to
relationship with Interests of Each
cultures Increase tender offers
a M&A prospect M&A Partner
Synergies
 Strive to empathize with potential offerees,
actively listen to their concerns and
COMMUNICATING constraints, ask open-ended questions
EFFECTIVELY
ACROSS Actively speak to the other side , in such a
CULTURES way that they develop a persuasive
argument to assert their own concerns and
constraints, and make sure they are
understood by the other side and are
perceived as convincing.
 NOTES !

IN A WORD, MANAGERS, PREPARING FOR

COMMUNICATION OUTSIDE THEIR OWN CULTURE, NEED
THE GAP BETWEEN THE OTHER AND THEMSELVES
Reduce the difference between others and them (1)
Questioning the answers that they hold about others and themselves (2)

 BUILDING A WORKING RELATIONSHIP WITH A

M&A PROSPECT
IN SOME SECTORS, LIKE MASS MARKETING, TAKING OVER A STOCK ALSO MEANS BEING LIABLE FOR
DEFECTIVE PRODUCTS FOR A PERIOD OF TEN YEAR. IT IS BETTER FOR ACQUIRERS TO KNOW WHAT THEY
CAN BECOME RESPONSIBLE FOR.

Accounting and Financial

Audit

Commercial Audit

Legal Audit

Social Audit
DETERMINING UNDERLYING
INTERESTS OF EACH M&A
PARTNER
Expansion
Reinforcing one’s position on a market
Gaining access to new markets
Benefiting from complementary skills, restructuring,
diversifying activities and risks
Integrating up- or down-stream, controlling the
costs of production or the prices of distribution, etc
DETERMINING UNDERLYING
INTERESTS OF EACH M&A
PARTNER
The interests that need to be clarified are in particular

Strategic Objectives Financial Objectives

 NOTES !

DURING THE NEGOTIATION PROCESS, MAKE SURE

THAT THE DEMANDS YOU MAKE BASED ON THE
CLARIFIED INTERESTS ARE REASONABLE. IF YOU
ASK TOO HIGH OR TOO UNREASONABLE, YOU WILL
BE JUDGED AS INSINCERE, CAUSING SUSPICION OF
YOUR PARTNER.
 SEARCHING FOR M&A NEGOTIATED OPTIONS
TO INCREASE SYNERGIES

PRACTICE THE PRINCIPLE OF RECIPROCITY

Proposing to learn from their counterparts,

before even asking them to learn from them

FIX CLEAR STRATEGIC OBJECTIVES AND FINANCIAL RESULTS

Managers, when possible, should also fix clear strategic objectives and
financial results. They should also talk about changes to cope with
weaknesses

INVOLVING EARLY ON IN THE PROCESS OF M&A

The representatives of the acquirer will be better off involving early on in
the process of M&A the managers of the prospect
 EVALUATING UNNEGOTIATED ALTERNATIVES TO TENDER OFFERS
(THE SPECIAL CASE OF HOSTILE TAKEOVER)

the acquisition of one company by another corporation against

"Hostile takeover"
the wishes of the former.

In a hostile takeover:

The company being

The target company
acquired

The one executing the

The acquirer
takeover
EVALUATING UNNEGOTIATED ALTERNATIVES TO TENDER OFFERS
(THE SPECIAL CASE OF HOSTILE TAKEOVER)

In a hostile takeover:

The acquirer goes directly to the company's shareholders or fights to

replace management to get the acquisition approved. Approval of a
hostile takeover is generally completed through either a tender offer or a
proxy fight.

The acquirer
EVALUATING UNNEGOTIATED ALTERNATIVES TO TENDER OFFERS
(THE SPECIAL CASE OF HOSTILE TAKEOVER)

A broader control in the target company

Advantage of a Allows them to define the terms of the new

Hostile takeover company and of its management as they please

Not have to negotiate the bid with the target

company The acquirer
EVALUATING UNNEGOTIATED ALTERNATIVES TO TENDER OFFERS
(THE SPECIAL CASE OF HOSTILE TAKEOVER)

Feel free to negotiate or not within the acquired

company at a later stage, during implementation
Advantage of a
Hostile takeover

Bidders can catch not only the target by surprise, but

also the market and the competitors
The acquirer
EVALUATING UNNEGOTIATED ALTERNATIVES TO TENDER OFFERS
(THE SPECIAL CASE OF HOSTILE TAKEOVER)

A financial risk in the evaluation of the target

Disadvantage of a An increased risk of failure of the operation

Hostile takeover because of the defenses that are raised by the
target

A risk of arousing anThe

hostile atmosphere in the
acquirer
new corporation if the bid initiator succeeds
 TIP KS
S AND TRIC

Noegotiate in
Select your
parallel, not in
negotiation team
series

Be decisive and Know when to

Determine what close the deal
put an offer on
you want and have plan B
the table
Group 4

CONCLUSION

Communication effectiveness must

A working relationship between
be developed across cultures both in
M&A partners help disclose
terms of awareness of self and
information for an extensive audit
empathy towards the other

A good understanding of both sides’ interests help overcome some

constraints and generate creative options that will not simply contribute
to deal-making, but also to prepare the implementation stage
 h a n k s
Tfor listening
ou r
nta tion!
prese