Acquisition due diligence

In this tough economy, evaluating potential transactions has never been more critical and competitive edge is vital. Financial due diligence is a critical aspect of transaction planning as it can affect the purchase price for a business or even the decision whether to proceed with a transaction.

Experienced professionals drawn from our corporate finance and specialist industry and tax teams provide due diligence services to help prospective purchasers validate the key assertions on which the proposed acquisition is to be based. Our approach to due diligence provides comprehensive and timely feedback for potential acquirers and financiers. The provision of reliable information throughout a transaction is critical to its success so we keep clients informed with regular updates, interim presentations and final reports issued to agreed timescales. In addition, we provide valuations, financial modelling and advice on sale and purchase agreements to improve client’s returns after completion.

We tailor the scope of our work to the proposed transaction, but a typical acquisition due diligence assignment includes:

  • an in-depth analysis of historic performance, cash flows, assets and liabilities
  • an assessment of forecast performance, including business model drivers, cash flow dynamics and working capital requirements, and key business sensitivities
  • a review of the business’s financial systems and controls and
  • an analysis of the tax position of the business

We can also advise on many areas of acquisition terms and documentation including warranties and indemnities, sufficiency of working capital, net debt and completion accounts.