Doing deals is all about teamwork. For FDs and their board colleagues, that means having clear messages and conscious control of their advisers, shareholders, and other stakeholders. They might be crucial passengers on the bus – but management has to be in the driving seat.

Fraser Park is a Glaswegian finance exec you don’t want to mess with – especially if you’re an adviser on a deal he’s involved with. The former CFO at Tandberg Television, Psion, Ubiquisys and Hailo has got bags of experience in all manner of deals. And as he explained to a packed audience assembled by fdu at Trowers & Hamlins’ London HQ, it’s up to management to pick a destination and drive for it, not the other stakeholders.“As a management team, you have the clearest picture, you have to drive the bus,” he stressed. “Yes, you need expertise from advisers, and ultimately it’s the shareholders’ value at stake. But you ought to know exactly what the deal needs to be and why it’s going to work.”

The bus analogy was endorsed by Thomas Chambers, a self-confessed tech lover who’s non-executive director at ten companies including, and former CFO at Symbian. Speaking to the role of chair – traditionally the guardian of shareholder value on the board – he pointed out that it was vital management was left to do the steering.“A chair can’t be the driver,” he said. “Obviously we need to know where we’re going and ideally how we’re going to get there. We might even be a breakdown service on occasions, helping out if the bus gets stuck. But management has to be in the driving seat.”Critically, he added, that means management must also have the capacity to both run the deal, keep the business going – and handle all the post-deal work.

So what about the advisers? In the bus analogy, they might be engineers, route-planners or driving training experts. But whatever role they play, they shouldn’t be an afterthought.“You have to engage advisers early – not just bring in an ultra specialist M&A boutique, for example, that can’t join the dots for the management team a bit more broadly,” explained Antony Isaacs, founding partner at ARI Advisers, a strategic corporate finance consultancy. “A good adviser can ask, ‘what makes you think this is a good idea?’ and question your long-term strategic aims for a deal.”For KP Doyle, former CFO and now Deputy CEO at Nuffield Health, that means building trust with them outside any particular event. “Having a bank of advisers with long term relationships who know your strategy and deal appetite helps you be ready to react to approaches and ensures opportunities not missed,” he said.But management teams do well to guard against “deal fever” – the mania to get a deal done regardless of the consequences or the terms that get layered in – which can grip their colleagues, advisers and even shareholders. Who they retain to do the hard work on crucial documents, due diligence and negotiations – and how – is also key.

The lawyer on the panel – Trowers & Hamlins’ partner Richard Hildebrand – agreed that tailoring the advisory team was a must. He also pointed out that knuckling down on adviser fees might look like good housekeeping – but if they do that, management need to be sure they can pick up the slack created by advisers needing to cut corners to keep their bill down, especially on time-consuming administrative jobs.Hildebrand also agreed with Isaacs on the broader role advisers can play when they’re not severely constrained around time and resources. “Knowing what all the various agents’ motives are can clarify things early on,” he said. “Are the shareholders passive? Are they being kept in the dark? As an adviser, knowing from whom you’re taking you instruction is key.”How you keep investors in the loop even if they are passive is also a factor, he added. “Shareholder memos, for example, ahead of the final agreement can save blushes – or worse – for advisers and management when the deal comes to be signed off.”

The value of clear communication was endorsed by KP Doyle: “Non-execs should ensure execs’ disclosure letters are done sooner rather than later, whether buyers or sellers – it always causes last minute problems and being forewarned is forearmed, especially if a seller.”Which brings us back to Fraser Park. He highlighted a deal recently (the sale of a business to a major corporate) where fours sets of lawyers – UK and US representatives from both parties – had locked horns over the fine detail. This was holding up a deal where timing was critical for both management and shareholders.
“So I took each side out of the room on a pretext,” he explained. “I made it clear that I realised they had their own agendas – not least their need to establish precedent for future deals where they might come into conflict. And we agreed that had to end. We needed the deal done.”A great example of the value of taking control in a context where management – and specifically an FD – was the only player with a complete picture.

And it served to emphasise one other point endorsed by the whole panel.Deals work better when they’re engineered by people with good relationships. That’s not just among the triumvirate of management, advisers and shareholders (and other stakeholders like employees, customers and communities, as several speakers stressed). But also between counter-parties.Deal fever is a curse not just because it allows ego to crowd out common sense and attention to detail. It also creates friction and even hostility that can be poisonous to a genuinely good transaction.