Based on my understanding of negotiation strategy and planning, I think Capital Mortgage Insurance Corporation has prepared quite well for the acquisition negotiation. In my understanding of the reading, Capital Mortgage Insurance Corporation had covered a broad range of information in order to enter negotiations. They had information about the parent companies, how they came to be, the stockholders, profiles of the stockholders, and several other tidbits. If they did overlook or left anything out, I wouldn't be aware as I have no idea how any of this works.
I think Corporate Transfer Services will huddle and come back with amendments to the offer. I think they want to sell but don't want to seem to anxious to settle and will try and get a little more out of Capital Mortgage Insurance Corporation.
Corporate Transfer Services responded by saying they wanted five million, not an estimated $420,000. Their response was not as I expected. I thought they would go closer to one million asking price but they went well above that.
I, personally, think Capital Mortgage Insurance Corporation should not laugh and then start to present how they got to the numbers they got to. They did their share of research and know that five million absurd. I am sure Capital Mortgage Insurance Corporation had prepared for a little wiggle room to make a second offer but not to accommodate what Corporate Transfer Services is asking for.
Corporate Transfer Services based their selling price off what another employee relocation company had sold for. They did not take into consideration their own personal business and just based their selling price off what another company had sold for not looking into if they had any similarities to the other company. I don't think Corporate Transfer Services went into this with nearly anywhere close to the amount of information and studying that Capital Mortgage Insurance Corporation had. Corporate Transfer Services took the easy way out hoping they would just put a number on the table and it would work. They didn't look at their actually numbers and what they were worth to make an educated counter offer.
I think Randall and Dolan should lay out exact what they found and how they came to the offering number they did. I think by showing Corporate Transfer Services how they came to the number they did, it would show Capital Mortgage Insurance Corporation how they don't really have the power to ask for the outrageous amount that they did.
I think Corporate Transfer Services will get scared. They see their only opportunity to sell walking out the door because they were not prepared. I think they will get the fourth owner back in and have an emergency meeting to come up with a solution. It is clear Capital Mortgage Insurance Corporation isn't going to waste their time arguing with someone who has no idea about their own company and I think that will scare Corporate Transfer Services into actually looking at what they have to offer. I think this could go in Capital Mortgage Insurance Corporation favor drastically now because Corporate Transfer Services was just schooled on their own MetroNet. That would make me double think what I actually knew about my company and maybe how badly I needed to take this offer because they might not get another offer of this magnitude, if ever getting one again.
I think Capital Mortgage Insurance Corporation should sit back and wait. I feel like they put a little scare into Corporate Transfer Services and they now have the advantage in the bargaining field. They had the information they needed and did their homework so when Corporate Transfer Services tried to make an uneducated statement Capital Mortgage Insurance Corporation schooled them on their own company. If Corporate Transfer Services doesn't come back with a solution within the next 12 hours, or when Capital Mortgage Insurance Corporation leaves then trash the deal. If Corporate Transfer Services really wants to sell they will have to cater to Capital Mortgage Insurance Corporation now.
I like Capital Mortgage Insurance Corporation's negotiating strategy. I think they are doing what they need to do at this point. It was clear Corporate Transfer Services didn't think this threw and Capital Mortgage Insurance Corporation isn't having it. They know that the advantage is now theirs. I don't think it will backfire because Corporate Transfer Services wants to sell, desperately. Each of the members had a reason to want to sell and it was a collective decision. I don't think they have another offer to even consider and if they don't sell now they may not ever.
I think Capital Mortgage Insurance Corporation should take the new offer back to Philadelphia and wait. They should counter offer with a little lower than their ceiling of $600,000 to still leave a little wiggle room. I would go back with $500,000 over and make it the final offer.
I feel like the most important aspect of Capital Mortgage Insurance Corporation's negotiating strategy was the research and knowledge that they prepared themselves with. They didn't leave any stone unturned in their research and went into negotiations with as much knowledge that could handle. I think this is what, eventually, lead to them getting exactly what they wanted and still staying within their range of bargaining they originally set.