Read the passage that attached and answer the following questions. I am the SELLER in this situation. What do you think that the most important issues are for your counterparty in the negotiation? What do you think is your counterparty’s BATNA? Reservation price? Target? What parts of the scenario work in your counterparty’s favor?

What do you think that the most important issues are for your counterparty in the negotiation?
What do you think is your counterparty’s BATNA? Reservation price? Target?
What parts of the scenario work in your counterparty’s favor?

Transcribed Image Text:You are the CEO and co-owner of Solaris Ltd. ("Solaris"). In a few minutes you will meet the CEO of the Energy Sector of Suremen AG (“Suremen”), to negotiate the potential acquisition of Solaris by Suremen. You have been authorized by the other co owners to negotiate the sale of Solaris. Suremen is among the oldest and largest industrial companies in the world. From its founding in 19th century Germany, Suremen has grown into a self described "global powerhouse" in electronics and electrical engineering. The company prides itself for its technical achievements, quality and global reach. Today, Suremen has more than 400,000 employees and in the last fiscal year Suremen earned a net income of €5.9 billion from revenues of €77.3 billion. Your counterpart is the CEO of Suremen's Energy Sector. The Energy Sector offers products and services for the generation, transmission, and distribution of power and for the extraction, conversion, and transport of oil and gas. In the last fiscal year the Energy Sector (workforce 80,000) had revenues of approximately €22.6 billion and posted a profit of €1.4 billion. The Energy Sector's mission is to expand its "green" profile, especially in the field of concentrated solar power plants. Concentrated Solar Power ("CSP") and the_DESERTEC Project CSP plants use sunlight to generate electricity. Large_parabolic mirrors track the movement of the sun, catch the sunlight, and concentrate it on a tube, called a "receiver". Receivers are assembled in multiple rows that make up the "solar field”. Receivers contain a special oil that is heated from the concentrated sunlight and subsequently is used to generate steam. The steam powers a turbine that produces the electricity. Areas that receive a great deal of direct sunlight which is not diffused by clouds, fumes or dust are suitable for CSP plants. Hence, these plants are typically located in steppes, bush, savannas, semi deserts or deserts, which ideally are within 40 degrees north or south of the equator. Areas that meet these criteria have an enormous potential for the generation of electricity. It is possible to generate up to 130 gigawatt hours (GWh) of solar electricity a year, enough to provide power for thousands of households and equal to the power that is produced by a 50 MW conventional coal or gas-fired power plant from solar energy collected from a 1 km² (or 0.28 m²) field. Greenpeace estimates that with ongoing improvements in solar technology, CSP power plants could meet up to 7% of the world's power needs by 2030 and fully one quarter by 2050. By 2020 this should reduce CO₂ emissions by 148 million tons annually, and 2.1 billion tons annually by 2050. To put these numbers into perspective, the CO₂ generated by Australia in the year 2009 was 394 million tons. Since the capacity of the typical CSP site by far exceeds local demand for electricity, the sunlight "harvested" in the regions most suitable for CSP must be exported to more power-hungry parts of the world. One ambitious example of this is the “DESERTEC” project. DESERTEC aims to build a net of CSP and photovoltaic power plants, as well as wind parks, throughout the desert regions of Northern Africa. The electricity would be transmitted to European and African countries by a "super grid" of high-voltage direct current cables. DESERTEC would meet most local demand for electricity as well as provide about 15% of the energy needs of continental Europe. The DESERTEC idea, originally developed by the Club of Rome, has gained considerable traction in recent years. Some of Europe's biggest companies (such as Munich Re, ABB, Deutsche Bank, and E.ON) have established a consortium to make DESERTEC a reality. The economics of the project are staggering - the consortium estimates that it will require investments reaching €400 billion by 2050. Suremen, as one of the founders of the DESERTEC consortium, hopes to gain a fair share of the DESERTEC business building solar energy plants and transmission lines and facilities. Suremen's existing product portfolio Suremen is the market leader in producing steam turbines for CSP power plants. It has already supplied the turbines for more than 50 CSP power plants worldwide. The company also designs and manufactures the other components needed for building a CSP plant (such as transformers, boilers and heat exchangers). However, Suremen does not produce receivers. Only two companies in the world have the technology to manufacture receivers: Scholl GmbH of Switzerland (which is also a member of the DESERTEC consortium) and Solaris Ltd. of Israel.