M&A deal-making is a lot like playing poker. For example, knowing whether you have a weak or strong hand is important because your hand’s strength helps dictate how you negotiate the deal.
Simply put, a weak hand means you have limited options. Time isn’t your friend. Work as quickly as possible to wrap up a deal (but be wary to not appear too desperate because that tips off the other side to your situation.)
A strong hand means that you have more options; time is on your side. However, you still have to play that hand skillfully. Many novices overplay strong hands and end up chasing an otherwise-willing deal-maker on the other side away from the deal.
The worst thing you can do is to misplay a weak hand. People have ruined their careers because they failed to understand the weakness of their position and pressed forward with a bad play.
Your hand is weak or strong only in relation to the other hands. Don’t just pay attention to your situation; assess the other side’s position as well. A strong hand in one situation may be a weak hand in the next deal.
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Source:http://www.dummies.com/how-to/content/ma-negotiation-key-to-success-know-your-position.html
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