I’m often asked for a due diligence checklist by clients or acquirers who are anxious to make sure they’ve covered all their bases. While there are plenty of due diligence checklists, I caution against using a list developed by someone else because it may not cover aspects that are important to your organization. Your questions …
Tag: due diligence
Six Ways to Reduce Stress During Due Diligence
Pursuing M&A is a passionate process. Emotions run the gambit from excitement in finding a new deal to anxiety about risks uncovered during the acquisition. I’ve found due diligence and negotiations to be among the most stressful times during mergers and acquisitions. Here are six ways to help everyone keep their cool during these critical …
Due Diligence and Integration – From Research to Action
Due diligence and integration fit hand in glove. Simply put, due diligence is the research and integration is the action. For example, due diligence and integration work hand-in-hand when you address benefits, such as healthcare, vacation, tuition reimbursement, paid time off, subsidized cafeteria plans and other perks. Deciding what to do with them is one …
Due Diligence: The Three Buckets of Critical Information
In performing due diligence, I recommend you look not only for risks but also for opportunities. That’s how I approach due diligence for our Capstone clients. As we examine the seller’s operations and books, we place every new discovery in one of three color-coded “buckets:” Red Bucket: Deal Changers. This is information that materially alters …
5 Approaches to Risks Identified Through Due Diligence
During due diligence, you may uncover deal-changing issues, or what I like to call “red bucket items.” Identifying these risks doesn’t necessarily mean you walk away from a deal, but you will need to negotiate new terms with the seller. Among the ways to protect yourself as the buyer when you find major issues: 1. …
Signs You May Be Buying the Wrong Company
Buying the right company is essential, but it is difficult. It may be easier to eliminate the “wrong” companies – prospects with glaring due diligence issues such as theft or lawsuits, or even more subjective issues like a poor cultural fit. However, the decision is not always so black and white. How can you know …
Due Diligence: More than Just a Checklist
What comes to mind when you think of “due diligence”? Most people picture an army of lawyers and accountants who pore through financials and company records after the letter of intent is signed. Once they uncover the significant risks, the deal is renegotiated based on their findings. But due diligence is more than just a …
Uncovering Liabilities Early On
The message I want to share with you here is simple but critical: start your due diligence early. In fact, start it the moment you begin the acquisition process. Conducting due diligence uncovers liabilities or hidden problems that can decide the success or failure of an acquisition. This could include issues such as past litigation, …
