Due Diligence Best Practices

by a searcher from The University of Chicago - Booth School of Business

3 years ago

Hi all,

Hope 2021 is treating you a lot better than 2020!

Curious to hear about Searchers' DD journey and wondering if I can tap into collective wisdom of this community for DD best practices, specially around the soft contentious topics such as WC negotiations or building rapport with the staff, suppliers, etc. 

I am about to kick-off exclusivity arrangement with a very good Industrial Electrical Manufacturing and Services business next week. Curious to hear stories about what worked, what to look for, etc. when oher Searchers' went through this path.

Thanks in advance!

PS: I have already scanned a lot of readily available great content on DD such as Axial's DD list, Jim's blog, etc. Thanks to the authors for putting those docs together.

Cheers,
Ankit

6 likes
284 views
14 comments

professional from University of California, Berkeley

One are that is often overlooked is IT infrastructure, specially if the intent is to merge the businesses. Having a solid assessment of the on-prem and cloud IT infrastructure is critical to a smooth transition.

3 years ago | like reply | 2 likes

professional from Pace University

I've done buy side due diligence on many acquisitions in my career as a CFO. Overall my advice, is understand what's going on in the seller's P&L and Balance Sheet. Ask about what might not be in there. Make sure tax returns and cash receipts (from customers) reconcile to the reported revenue. Understand what changes you can actually make to the business and how that will impact future profits and cash. And make sure your due diligence covers things like customer concentration, retention rates, important staff, vendors and suppliers and other non-financial things like company culture. Feel free to reach out for more via email --@----.com

3 years ago | like reply | 3 likes

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