Due Diligence: Security for prospective buyers

What is due diligence?

The term “due diligence” can be interpreted as “due care”. Due diligence is intended to enable prospective buyers who have submitted an indicative purchase offer to you to verify whether the information you have provided to them in the process to date, particularly with the files in the data room, is really accurate. Prospective buyers will go through your company with a team of specialists, often industry experts, accountants and tax advisors.

How does due diligence work?

Due diligence is typically conducted along operational functions. Accordingly, a Financial Due Diligence, a Commercial Due Diligence, a Technical Due Diligence, a Personnel Due Diligence, a Legal Due Diligence and a Tax Due Diligence as well as a Site Due Diligence. The results of these individual professional reviews intertwine and complement each other. A complete picture only emerges from an integrative development.

What are the benefits of due diligence for corporate buyers?

In a systematic due diligence, the transaction risk for prospective buyers can be minimized. In particular, follow-up costs can be estimated with a high degree of probability and, above all, deal breakers can be uncovered, i.e. facts that speak against a purchase decision.

What other benefits can due diligence provide?

The use of due diligence is not limited to the case of a corporate transaction. Due diligence can also reveal the location of your company and potentials that can be tapped in ongoing business without the intention to sell. Due diligence is therefore an excellent basis for controlling and systematic corporate development.


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