Menu

Invest confidently through buy-side due diligence

Adding to your private equity portfolio? Unmask the right deal. 

Making the right acquisition at the right price is critical in today’s complex and competitive deal-making environment. If hasty decisions are made to buy without completing overall business, technology, financial and operations assessments, the transaction may be delayed or systemic problems may not be uncovered until post transaction, causing business disruptions, stresses on your existing portfolio businesses and financial losses. Or, worse yet, the targeted business may not be valued appropriately due to undisclosed issues pre-sale. Finding that out after the deal has been executed could not only be challenging, but harmful to your overall future business.  

To minimize transaction risk, employ a fully integrated buy-side due diligence process that includes financial, tax and operational due diligence. This integrated approach can help you understand your risks and opportunities so you can make an informed decision about how and whether to proceed with the deal while protecting your interests.

Specifically, the process unmasks and assesses the following areas about the targeted business:

  • Earnings and cash flow quality
  • Assets and liabilities quality
  • Internal control weaknesses related to systems and personnel
  • Deal structure from a tax perspective
  • Federal, state and local tax compliance risks and issues
  • IT infrastructure and system issues and future cost savings and requirements
  • Financial projections
  • Purchase agreement details and alignment
  • Risks and costs associated with complex transactions like carve-outs and add-on acquisitions

Understanding the above allows you to weigh transaction price and terms as well as the future of the targeted business. Other advantages of an integrated buy-side due diligence strategy include:

  • Gained insights about risks and opportunities to address pre- and post-transaction
  • Efficient transaction speed, and in some cases, accelerated transaction close
  • Maximized organizational and operational efficiencies in add-on integration
  • Minimized transitional service agreement cost burdens for carve outs
  • Reassurance of day-one readiness with seamless resources support
  • Efficient management adaption to private equity ownership

Buy-side due diligence allows you to analyze and validate critical financial, operational and strategic aspects of the deal, making it easier for you to structure and negotiate a favorable transaction that’s right for your overall portfolio.

Contact us to learn more about buy-side due diligence as well as other pre- and post-close ideas.


You may also be interested in:

Q3 venture capital trends summary

INSIGHT ARTICLE

Q3 venture capital trends summary

From funding to financing, venture capital activity through the third quarter of 2019 has been record breaking.

Q3 2019 Dealmaker Roundup

AUDIOCAST

Q3 2019 Dealmaker Roundup

A panel of private equity deal experts address Q3 deal activity and share thoughts on investment opportunities in financial services.

Private equity: What's in it for the doctors?

AUDIOCAST

Private equity: What's in it for the doctors?

As PE firms are increasingly investing in healthcare businesses, what are the economics of such deals on doctors? Listen and learn.

Disrupted health care: Is your business a Netflix or a Blockbuster

AUDIOCAST

Disrupted health care: Is your business a Netflix or a Blockbuster

How is disruption in the health care industry impacting patients? RSM experts discuss this important trend. Listen and learn.

INSIGHT ARTICLE

Bots can make businesses healthier

RPA delivers the ability to automate highly-manual, yet low complexity processes to improve accuracy and speed with lower costs.

INSIGHT ARTICLE

Invasive procedures: Making merger integrations work in health care

With buy-and-builds becoming more prevalent in health care M&A, effective merger integration can be critical to success.

INSIGHT ARTICLE

Cyberthreats: More about people than IT

Before investing in a health care company, private equity firms need to thoroughly understand the cybersecurity risks they may inherit.

INSIGHT ARTICLE

A new era for behavioral health

PE investors and health care entrepreneurs see an opportunity to offer behavioral health services via efficient and tech-enabled platforms.

INSIGHT ARTICLE

In search of true disruption

Innovative companies are working on ways to break health care’s legacy mold and deliver better experiences and outcomes for patients.

Mergers and acquisitions: A growth strategy for food and beverage

VIDEO

Mergers and acquisitions: A growth strategy for food and beverage

Stonewall Kitchen president and chief operating officer discusses the role mergers and acquisitions play in their growth strategy.