For those who does not know what is a due diligence, here is a little overview of this matter.
You will see that behind this double ducth, it is something quite easy to understand...
When a specific operation that might have important financial consequences is planned, you often need to get in touch with your lawyers in order to organize and formalize the negotiations.
Therefore you will start what we call in our jargon a "due diligence".
see below the way it happens and most of all, the main step of such porcess:
I) INTRCOUDCTION: TOPICS TO BE COVERED
What is a due diligence?
Why and when do you conduct a due diligence?
How to conduct a due diligence? (what is the process).
The due diligence report.
Conclusion
II) What is a due diligence
It is essentially an investigation to manage risks.
Broadly defined the term "Due diligence" is universally applied to investigations of information provided by a potential seller to a potential buyer.
III) Why and when do you conduct a due diligence?
Why? Transactions involve substantial financial obligations.
A characteristic of our business environment is to always present the best picture.
Essential to determine the undisclosed risks which are attached to the transaction as this may result in the transaction being aborted or affect the purchase price or terms of the agreement.
IV) When?
Merger and acquisitions
Joint ventures
Privatization of sate organizations
Commercial undertakings for example, stock exchange listings, financing projects and performance based commercial agreements.
V) How / What is the due diligence process?
Appointment of the team
Skills/ expertize
Clear and define mandate
Costs
Confidentiality agreements
VI) How / What is the due diligence process (cntd)?
Data room and access to the room
Due diligence questionnaire and checklist
one on one interviews with management from the target company
VII) The due diligence report
This report should contain:
An outline of the scope of the review.
An analysis of the documentation and information revealed
VIII) The due diligence report (CNTD)
A list of all the information disclosed by investigations (public record searches).
Limitations and disclaimers of liability
An executive summary which outlines the lega issues identified and advises on the legal implications of proceeding with the transaction (risks and liabilities).
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IX) Conclusion
Now fix it up
Fast food and late nights
prevents unsound business transactions
Now fix it up
Fast food and late nights
prevents unsound business transactions
§
During my young career, I have already executed four due diligences.
I have been involved with our lawyers into a pretty big capital increase of 32 M € last year...I don't know if I have already specified that I was currently working in a listed company, therefore our shares are in scripted in a stock market of course.
In addition, I have already started two acquisitions procedure on two international and well known company in order to evaluate the relevance of these potential acquisition.
And my last due diligence was in relation to a financial operation with convertible bonds issuance.
That was very interesting. Due diligence are gripping aspect of business law...you have to evaluate synergies between two activities and entities, you need to understand the operational consequences in addition to the financial potential benefit.
Frankly speaking, I think that data room' process and all the paperwork analysis has to be performed by young lawyers with minimum legal competences.
What you only expect from them is to synthesis the business through the documentation analyze. Once that this job has been done, you have all the relevant tool to make up your mind and to take time to decide on the opportunity...
That's the business...
