The essential role of due diligence

The due diligence process can include a review of the financial, legal, and commercial aspects of a transaction. It can be lengthy and is generally conducted on behalf of a buyer.  

The financial due diligence report is an investigative analysis of the business's financial performance.  The report will focus on the robustness of the financial performance, identifying areas of sensitivity, and ensuring that the funding structure is suitable for the transaction. The report can also include an assessment of the synergies that would be expected to accrue in a transaction.

Legal due diligence is an assessment of the detailed legal landscape within which the target operates and the report will help the buyer understand the potential legal liabilities surrounding a business.

A commercial review will focus on identifying the company’s position in the market, growth opportunities, and how it differentiates itself from its competition.

Due diligence is an essential element of the acquisition of a company and any seller needs to plan carefully to ensure that all information is presented in a clear and concise manner to reduce the possibility of challenges that could fundamentally affect a deal or in the worst case kill it stone dead.  

Pierce Corporate Finance has experience in assisting sellers to complete their own “Seller Due Diligence” to highlight these areas of concern before engaging with buyers so that key information can be presented at the start of the process.

Through our extensive experience, the team can provide clear unambiguous advice on the financial aspects of a transaction, advising buyers, sellers and funders and adding real value to the transaction process.

Contact the team today.