Due Diligence Services
What is Due-Diligence?
Due Diligence is the process by which confidential legal, financial and other material information is exchanged, reviewed and appraised by the parties to a business transaction, which is done prior to the transaction. It is basically a “background check” to make sure that the parties to the transaction have the required information they need, to proceed with the transaction..
Due diligence is used to investigate and evaluate a business opportunity. The term due diligence describes a general duty to exercise care in any transaction. As such, it spans investigation into all relevant aspects of the past, present, and predictable future of the business of a target company.
Objectives of due diligence:
Collect material of information from the target company.
Conduct a SWOT analysis to identify the strength and to uncover threats and weaknesses.
For improving the bargaining position depending on SWOT analysis.
To take an informed decision about an investment
Identification of areas where representations and warranties are required.
To provide a desired comfort level in a transaction.
To ensure complete and accurate disclosure.
Bridge the gap between the existing and expected.
To take smooth/accurate action/decision.
To enhance the confidence of stake holders.
Transactions that require due diligence
Mergers, Amalgamation and Acquisitions
Joint Venture and collaborations
Venture Capital Investment
Types of due diligence:
A. Business Due Diligence
Operational due diligence
Strategic due diligence
Technical due diligence
Environmental due diligence
Human Resource Due diligence
Information Security due diligence
Ethical Due Diligence
B. Legal Due Diligence
C. Financial Due Diligence
The following documents needs to be checked during the due diligence process:
Important business Agreements
Internal control system
Human resources aspects