What Is M&A Due Diligence?

In order to ensure the success of an M & A, the acquiring company must conduct a detailed investigation of the acquired company in order to formulate a suitable merger and acquisition and post-merger integration strategy. The M & A investigation should include the background and history of the company, the industry, the company's marketing methods, manufacturing methods, financial information, research and development plans, and other related issues.

M & A due diligence

If you want to ensure that your company s mergers and acquisitions have a greater chance of success, you must

In general, investigations in mergers and acquisitions should mainly include the company's operations, rules and regulations, and related contractual and financial aspects. The specific investigation content depends on various factors such as the management's demand for information, the size and relative importance of the potential target company, the reliability of the audited and internal financial information, the size of the inherent risk, and the time allowed. .

1. Investigation on the operation status of the target company The investigation on the operation status of the target company is mainly based on the motives and strategic needs of the acquirer to investigate and measure whether the target company meets the merger standards. If the acquirer wants to make use of the

Enterprise mergers and acquisitions are a systematic project involving economic policies, financial systems, related laws and regulations. Fully understanding the basic situation of the acquired company, including legal status, funds, credit, personnel, etc., is the prerequisite for successful acquisition. The investigation of the acquired merger enterprise mainly includes:

(I) Target company organization and property right structure 1. The organizational structure of the target company and its subsidiaries and

The essence of mergers and acquisitions is a kind of transfer of rights in the course of the movement of corporate control. M & A activities are carried out under certain conditions of property rights system and enterprise system. In the process of M & A, one or some part of the rights subject obtains corresponding benefits by transferring the control of the enterprise to the other part, and another part of the rights subject This part of control is obtained by paying a certain price. The process of corporate mergers and acquisitions is essentially a process in which the subject of corporate rights is constantly changing. ^[1]