Posted on: July 7th, 2017

deal waves Closing a deal is like riding a succession of waves. Some waves are helpful, others are turbulent and can upend the whole deal.

There are hundreds of reason why deals get upended.Sellers can get cold feet, the numbers go can go in the wrong direction, or something out of the blue, such as a background issue can pop up.

The only constant in the deal world is that – IT is always something. You just never know what the IT is on each deal. Unpredictability is the norm, and today’s surefire closing can become tomorrow’s dead deal.

Sometimes it’s a serious issue that merits scrutiny, other times it is a minor issue that somehow becomes a huge issue. To close a deal, you have to accept the volatility of the deal waves.

The key is making sure that after the turbulent wave hits, you can get the deal back on track. You have to have the expertise and wisdom to influence decision makers to make that happen. Here are five ways to achieve this;

Game plan forward – whatever the issue is, crystallize it and develop a joint plan to get through it. Make sure the all parties are bought into the solution, and that teamwork will solve it.
Exert a calming influence – when deals blow up, emotions are high and people need to be brought back to a state of objectivity. This happens through a relaxed approach, where you keep the parties talking and get them to see how much common ground they share.
Bring Closing Optimism to the table – in deals, much like life, it is always darkest before the dawn. Optimism is infectious. With you showing confidence to others, they are more likely to believe they can get through the obstacles and close.
Reinforce Real Human Connection – digital communication gets in the way of real human interaction and can sometimes alienate people. Make sure that you get everyone dealing with other parties on a human level, not just an emailing level. Often, parties want the same thing but are just expressing it in a sub optimal way.
Validate their work- often closing can be grueling and people get tired and cranky. By acknowledging their valuable work and contribution to the team effort, you can help lift their spirits and improve their mind set.

In the acquisition financing arena, capital availability is destiny as companies require reliable access to capital to grow over the long term. Unforeseen capital needs usually arise when acquirers least expect it. This can cause some concern for the acquisition financing provider, especially when covenants tighten up and that working capital availability is utilized faster than expected.

Mezzanine debt borrowing is usually a straightforward activity that many companies use for funding of transitional growth. Mezzanine debt lenders are highly transparent about their due diligence approach and their post-closing loan management making it easy for companies to engage with.

Elections have consequences and positive ones at that for the acquisition financing middle market. While much media attention is paid to the direction of the yield curve and the Fed’s likely rate cuts, scant attention is paid to the more important drivers of the acquisition financing market – business psychology and regulatory climate.

Managing Unpredictable Deal Waves