Due Diligence |
Due Diligence is the process whereby the acquirer or the funders investigate the business in question to satisfy themselves about its value and to discover whether there are any hidden nastiest. It is usually carried out after the “subject to” commitment is made by the funders/investors. These processes cover a variety of areas, depending on the industry involved and the complexity of the deal. Due Diligence or the detailed examination of a company and its financial records is the first step before buying it or just picking up a stake.
We offer Due Diligence Services to clients looking at potentially purchasing an investment. We create and collate a listing of required documents, preparation of due diligence documentation for purchaser inspection, management of due diligence materials and review the seller's due diligence materials on behalf of the purchaser, to offer our clients the most in-depth and detail understanding possible. Proper due diligence is all about helping you unlock the value in your acquisition strategy, not just about finding liabilities in the target’s balance sheet. We work at the stage of identification of potential purchasing to help you draw out where the key risks and opportunities in the proposal transaction lie and to help you do any early appraisal of possible targets. |
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| Types of Due Diligence |
| Financial Due Diligence: |
It is the most important aspect of the diligence process where the health of the target company is determined by looking at its assets and liabilities in the short, medium and long term. It is done by analysing the financial information to spot any misappropriation or governance issues.
Our role in a Financial Due Diligence Review involves evaluating the proposed deal by analyzing the present and historical financial statements including important agreements reviewing the control environment and assessing the risk incidental to the business. |
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| Tax Due Diligence |
This examination helps the purchaser determine the past, present and future tax liabilities of the target entity including disclosed, undisclosed realised and unrealised tax liabilities. This helps establish the purchase price and the type of tax warranties and indemnities included in the sale agreement.
When companies acquire a business, dispose of a non-core business or go into a merger, they need to manage the tax risk by means of a Tax Due Diligence. We provide you with direct and indirect Tax Due Diligence while focusing on risks (including quantifications) as well as opportunities. |
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| Forensic Due Diligence |
| It is done to focus on the softer aspects of the business, the company and promoter’s goodwill and general image in the industry. A forensic due diligence looks at the background of the promoters, their affiliations with political parties pending personal legal cases and their image in the society. Though such softer issues might not have direct impact on valuations they can be determining factor in an M&A deal. |
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| Legal due diligence |
The aim here is to ferret out legal risks, if any. This due diligence helps improve the buyer’s bargaining position and ensures that necessary precautions are taken in relation to the proposed transaction.
In an M&A process, any responsible management will require a comprehensive assessment of the possible legal risks related to the corporate status, assets, contracts, securities, intellectual property etc. of the target company concerned. The negotiation of the transaction will in most cases require the intervention of a legal expert as numerous legal pitfalls need to be tackled as early as at the negotiation table. The drafting of the transaction contracts and related documents cannot be done without the special attention from a business angle.
We perform a full legal due diligence resulting in an assessment of the main risks and provide potential solutions that reduce the risk and provide assistance in drafting the letter of intent/confidentiality and exclusivity agreements/the share purchase agreement (SPA)/the representations and warranties, etc. |
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| We do |
- To generate valuable due diligence reports and business analyses for our client that become an integral component of their decision-making and negotiation processes. We offer a confidential, sound, unbiased perspective which is the ideal complement to client's internal resources.
- To focus on providing value-added services that enhances client business decisions by combining a thorough understanding of technologies, logistics, corporate strategy and finance with an ability to summarize complex issues into concise, easily understood terms.
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| Merger and Acquisition Due Diligence |
| This exercise is of key importance as it enables the buyer to fully understand the risks and rewards before finally striking a deal. Due Diligence is conducted by specialised consultants who analyse various aspect of the business and assign importance and value to arrive at a holistic valuation of the target company. |
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