07_Negotiations_forJoint_Ventures.ppt

Negotiations for Joint Ventures Getting into business with a partner Introduction Joint Ventures are enterprises established by two companies, one of which is foreign. Important Factors Sequence Structures Role of Government Prospective partners Content What is a Joint Venture? A Joint Venture is an agreement between two companies to form a third company. Different corporate structures exist. Sequence for Negotiations One company (or both companies) will consider whether or not to invest in a foreign country. If the decision is taken to invest, the means of implementing that decision may include setting up a Joint Venture. Preparations Negotiations with different government levels may be required to ensure that the Joint Venture conforms to the rules and regulations that are in force. Negotiations with prospective partners will be substantive and non- substantive. Beginning the negotiations Overall view point may not initially discuss details. Negotiations may have to take place with other agencies mostly on the basis of gaining information and approval. What will be Negotiated Share Capital How much each partner contributes and in what form Management The rules governing the direction and management Personnel Any special considerations affecting personnel Exit Strategies How the foreign partner can recoup the original investment Conclusion Negotiating Joint Ventures is about the setting up of a company and the rights and obligations of each partner as well as how the company will be managed.