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Comment by putlake

This pertinent HBR blog post is very interesting: https://hbr.org/2016/03/dont-use-round-numbers-in-a-negotiat...

The TL;DR version is that acquisition offers in round numbers signal that the buyer hasn't done proper due diligence. "Round initial offers were less likely to secure a deal than precise offers. When they did, they ended up costing the bidder more. All other things being equal, an acquisition launched with a bid rounded to the $5 level had, on average, an $18 million larger price tag than an acquisition launched with a more precise bid. The stock market reaction was also 2% less (i.e., the bidder’s stock price jumped on average 2% less) for bidders making round offers than for those making precise offers."

parent putlake 10 years ago

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