Last week I wrote about the Pittsburgh Steelers’ Rooney family negotiations and the depersonalizing impact of bringing in outside experts to provide independent, credible opinions of the value of the assets at issue (here the value of the Steelers and their dog and horse racing interests).
This move often shifts the focus from parties’ opinions – often laden with emotions, especially in family negotiations – to opinions of independent, objective experts.
But there’s more to this story. Interestingly, the appraisals of the assets appear to have priced out the two brothers who wanted to keep control of the Steelers. They apparently didn’t have the liquid capital to buy out their brothers’ shares in the team (who reportedly wanted money upfront and not as debt paid out over time).
So to keep control of the team, the two Rooney brothers started looking for ways to finance their purchase of their brothers’ shares. To get this capital, they spoke to an extremely wealthy friend.
The result? That individual may buy an interest in the Steelers for a big chunk of cash but let the two Rooney brothers continue to control it. This could give the Rooneys who want to sell a way to cash out and keep the team under Rooney control. But it would involve bringing in a new partner, always a risk.
What’s the lesson here? Initially, you’d think a very high Steelers valuation would be helpful to all the Rooneys. It increases all their net worths, right? Yes, but a higher net worth doesn’t appear to be the ultimate goal of two of the Rooneys. Control of the Steelers – a nonmonetary goal – appears to have precedence here.
It’s critical in all negotiations to prioritize all your goals and interests – monetary and non-monetary. Here it’s not all about money. It’s also about control, a nonmonetary interest. This focus on nonmonetary interests is typical in many family negotiations.
A colleague of mine years ago got divorced and, as the primary breadwinner, she ended up paying her husband much more than he would have received if the case had gone to court.
I was somewhat surprised, and so I asked her why. She said she needed closure, wanted to psychologically move forward as soon as possible, and figured she had sufficient income to pay it without much difficulty. In short, closure to her was more important than money.
So next time a family dispute ends up on the negotiation table, keep the importance of the parties’ nonmonetary interests front and center.