After A Pirate Negotiation, A Personal Connection

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They dropped the money for the pirates from a helicopter on a Friday morning. Shipping executive Per Gullestrup's crew was released and headed home. The pirates, in the Gulf of Aden, headed off.But the next morning, Gullestrup was in his kitchen in Copenhagen when his cell phone rang. The caller was Mr. Ali, the pirate negotiator who says he is known on dry land as Ali Mohammed. When he got ashore and got back to his home in Somaliland and he called me, initially, funnily enough, it was almost a courtesy call, says Gullestrup, CEO of the Clipper Group. He just wanted to say he'd gotten back home.That surprising call marked another step in an unusual working relationship, between a bargainer for pirates demanding a $7 million ransom and the businessperson trying to se sailors' lives. We started talking because I was curious about the inner working of the system ... and he was very forthing with that, Gullestrup says.Over the course of their conversations, Gullestrup asked about the pirates' thinking when they lowered the ransom figure. Gullestrup won't say exactly how much the pany paid, only that it was between $1 million and $2 million.For his part, Mohammed says he was curious about the shipping pany's bargaining strategy, and that the men he continued to e-mail back and forth two or three times a day.We talk about the issues of piracy or this or that, Mohammed says.

Their experience speaks to business negotiations everywhere, which lee the parties not necessarily as adversaries. Gullestrup is operating in circumstances where he is essentially on his own. He can't expect military help when and where he needs it.

Pirates, meanwhile, are colluding, sharing intelligence in an unregulated environment. Economists would say the dynamic centers on market power. The situation makes it hard for a shipper like Gullestrup to figure out the market rate for ransom.