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MERGERS-ACQUISITIONS-BASICS5 MIN READ

Walk LOI terms without giving away your BATNA

Use BATNA and ZOPA thinking to respond to LOI pressure across price, structure, and exclusivity.

LOI pressure The seller asks for a higher headline price, 60-day exclusivity, and no contingent consideration. Each concession changes leverage before diligence is complete. Negotiate the package BATNA -> ZOPA -> term trade Use your alternative to set the limit, then search for overlap across structure and process terms. Raise price Fast, visible, and often expensive. A term package that keeps leverage and protects downside. Do not spend price to solve a term problem until you understand the seller's real interest. 01 Price 02 Exclusivity 03 Upside Seller counter Seller asks for $6 million above your risk-adjusted case, citing a…

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