Emotion and drama earn their pay rise

If it were just about money, the investment bankers and their other advisory colleagues would find life a lot easier.

Despite all the beliefs about shareholders and their hip pockets, there's another level of complexity in takeovers that ensures those who know how to put a good case have an edge.

It's the emotion and the drama.

Last year's management buy-out proposal at Alinta Ltd and this year's board battle at WA Newspapers Holdings Ltd are probably at the high end of that.

Both matters involved a savage war of words, especially in the WAN battle, where Seven Network Ltd went into overdrive to present its case.

Apart from the usual army of advisers, there was a website and enough letters to keep the postal service busy for weeks. Seven employed lobbyist firm Halden Burns to assist its efforts, perhaps an indication that Kerry Stokes' pitch for a WAN directorship was more like a political campaign than a traditional boardroom scrap.

Like Alinta before it, the WAN stoush was an extremely high-profile affair, because the pitch was to mums and dads, with winning being beyond the sway of a few institutions.

Both matters involved some collateral damage for the boards involved. Alinta's board was lynched by the national press for acting too slowly, while the MBO proponents won no friends among shareholders, who ultimately took the other offer.

In hindsight, with the dreadful performance of Alinta's new parent Babcock & Brown Ltd, perhaps the MBO players were the lucky ones.

If Alinta shareholders were upset about their board's perceived procrastination and management's decision to put the company in play, WAN shareholders were livid at their board for not allowing them a choice with regard to who would direct the company.

Even when mums and dads are not so important, the role of communications experts in the takeovers game has grown.

Take the battle between Midwest Corporation Ltd and Murchison Metals Ltd over control of the Mid West's iron ore assets and infrastructure - two of the state's most corporate-focused public relations firms sit on either side of the action.

Midwest is represented by West Perth's Purple Communications, while Murchison has Nedlands-based Porter Novelli for its charm offensive.

The former, led by director Warrick Hazeldine, has worked for Ausdrill Ltd and Territory Resources Ltd of late.

UWA Business School professor, Raymond da Silva Rosa, said the emotional element was prevalent when it came to takeovers by foreign companies.

"Target company shareholders tend to be less inclined to follow their board's recommendation to accept a bid if it is made by a foreign company. If anything, foreigners tend to overpay, which might explain why target company boards often recommend them."