Overview

Drawing on real-life cases from a wide range of industries, two acclaimed experts offer a sophisticated but accessible guide to business deals, designed to maximize value for your side. Business transactions take widely varying forms-from multibillion-dollar corporate mergers to patent licenses to the signing of an all-star quarterback. Yet every deal shares the same goal, or at least should: to maximize the joint value created and to distribute that value among the parties. Building on decades of experience teaching and advising on business deals, Michael Klausner and Guhan Subramanian show how to accomplish this goal through rigorous attention to designing incentives, conveying information, and specifying parties' rights and obligations. Deals captures the range of real-life transactional complexities with case studies covering Microsoft's acquisition of LinkedIn, Scarlett Johansson's contract dispute with Disney over the release of Black Widow, litigation surrounding LVMH's pandemic-disrupted acquisition of Tiffany, the feud between George Norcross and Lewis Katz over ownership of the Philadelphia Inquirer, NBC/Viacom's negotiation with Paramount over the final three seasons of Frasier, and many more. In clear, concise terms, Klausner and Subramanian establish the basic framework of negotiation and the economic concepts that must be addressed in order to maximize value. They show how to tackle challenges, such as information asymmetry between buyer and seller, moral hazard, and opportunistic behavior. And the authors lay out responses to common risks associated with long-term contracts, emphasizing that a deal's exit rights should be carefully considered at the start of transaction design. Unique in its practical application of economic theory to actual dealmaking, this book will be an indispensable resource for students and for professionals across the business and legal world.

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9780674495159

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Reviews

Klausner and Subramanian’s book will be an invaluable resource for anyone who wants to understand real-world contracts and deals. The authors present many interesting cases and skillfully use basic economic ideas to understand them. There are many insights for practitioners, but academics will also learn a great deal and will be stimulated to refine their theories. -- Oliver Hart, winner of the Nobel Prize in Economics and Lewis P. and Linda L. Geyser University Professor, Harvard University This book is critical for anyone interested in exploring how structuring and negotiating a deal is more than a zero-sum game—that sophisticated transactional professionals can create value. Using real case studies of deals covering a wide range of industries, Klausner and Subramanian make complex economics a tractable tool. The result is a theoretically rich and yet practical resource for deal practitioners. -- Ronald J. Gilson, Stern Professor of Law and Business, Emeritus, Columbia Law School, and Meyers Professor of Law and Business, Emeritus, Stanford Law School Whether you are newly enrolled in business or law school, a seasoned professional in finance, or a curious reader intrigued by the inner workings of deals that make the headlines, this is an indispensable volume to have on your bookshelf. -- Stephen R. Munger, Chairman, Global M&A, Morgan Stanley & Co. All business transactions—from a relatively straightforward acquisition to the most complex merger—share a set of simple and elegant underlying economic structures. The key to optimal dealmaking lies in focusing on the key economic drivers and not getting distracted by all the other noise. There is no better guide for this than Klausner and Subramanian’s book. -- Barry Volpert, cofounder and CEO, Crestview

Whether you are newly enrolled in business or law school, a seasoned professional in finance, or a curious reader intrigued by the inner workings of deals that make the headlines, this is an indispensable volume to have on your bookshelf. -- Stephen R. Munger, Chairman, Global M&A, Morgan Stanley & Co. All business transactions—from a relatively straightforward acquisition to the most complex merger—share a set of simple and elegant underlying economic structures. The key to optimal dealmaking lies in focusing on the key economic drivers and not getting distracted by all the other noise. There is no better guide for this than Klausner and Subramanian’s book. -- Barry Volpert, cofounder and CEO, Crestview This book is critical for anyone interested in exploring how structuring and negotiating a deal is more than a zero-sum game—that sophisticated transactional professionals can create value. Using real case studies of deals covering a wide range of industries, Klausner and Subramanian make complex economics a tractable tool. The result is a theoretically rich and yet practical resource for deal practitioners. -- Ronald J. Gilson, Stern Professor of Law and Business, Emeritus, Columbia Law School, and Meyers Professor of Law and Business, Emeritus, Stanford Law School Klausner and Subramanian’s book will be an invaluable resource for anyone who wants to understand real-world contracts and deals. The authors present many interesting cases and skillfully use basic economic ideas to understand them. There are many insights for practitioners, but academics will also learn a great deal and will be stimulated to refine their theories. -- Oliver Hart, author of <i>Firms, Contracts, and Financial Structure</i>

All business transactions--from a relatively straightforward acquisition to the most complex merger--share a set of simple and elegant underlying economic structures. The key to optimal dealmaking lies in focusing on the key economic drivers and not getting distracted by all the other noise. There is no better guide for this than Klausner and Subramanian's book.--Barry Volpert, cofounder and CEO, Crestview This book is critical for anyone interested in exploring how structuring and negotiating a deal is more than a zero-sum game--that sophisticated transactional professionals can create value. Using real case studies of deals covering a wide range of industries, Klausner and Subramanian make complex economics a tractable tool. The result is a theoretically rich and yet practical resource for deal practitioners.--Ronald J. Gilson, Stern Professor of Law and Business, Emeritus, Columbia Law School, and Meyers Professor of Law and Business, Emeritus, Stanford Law School Whether you are newly enrolled in business or law school, a seasoned professional in finance, or a curious reader intrigued by the inner workings of deals that make the headlines, this is an indispensable volume to have on your bookshelf.--Stephen R. Munger, Chairman, Global M&A, Morgan Stanley & Co. Klausner and Subramanian's book will be an invaluable resource for anyone who wants to understand real-world contracts and deals. The authors present many interesting cases and skillfully use basic economic ideas to understand them. There are many insights for practitioners, but academics will also learn a great deal and will be stimulated to refine their theories.--Oliver Hart, author of Firms, Contracts, and Financial Structure

Author Information

Michael Klausner is Nancy and Charles Munger Professor of Business and Professor of Law at Stanford Law School, specializing in corporate law and financial regulation. Guhan Subramanian, Joseph Flom Professor of Law and Business at Harvard Law School and Douglas Weaver Professor of Business Law at Harvard Business School, is the author of Dealmaking: The New Strategy of Negotiauctions.

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