If you have been to an M&A conference and listened to the advice of experienced dealmakers, you will have heard them advising you to “get good counsel; inexperienced lawyers kill deals.” Periodically I am reminded of how sound this advice is – when I run into inexperienced counsel who threatens to kill a deal. The problem is, counsel is in direct contact with buyer’s counsel, and sets the stage for the negotiation. If they raise ridiculous or irrelevant points, it reflects badly on the seller. If they have a misguided sense of how to display strength and determination in the negotiation, then they can create lots of friction with zero benefit. So the advice is clearly on point, but how do you solve the problem?
Being a lawyer myself, I have the clear advantage of being able to jump in and reframe the legal discussion from the standpoint of my experience working on hundreds of deals. Likewise, an experienced banker or dealmaker can always appeal to “market,” as in “the points our lawyer are asking for are clearly not ‘market’.” Finally, there is an appeal to the board and the CEO, asking them whether they want to close the deal, or play games with the buyer until everyone gets fed up and throws their toys out of the crib?