A diligent purchaser goes to great lengths to evaluate all of the legal and regulatory risks and opportunities involved in the target business. Such a systematic overall evaluation of the business is seldom done in any other situation.
One trend is that due diligence is getting more and more focused and concentrated on spotting the relevant system errors and major risks entailed in and affecting the target and its business. At the same time there is increased focus on identifying issues that may bring a competitive edge.
All of the identified issues are ultimately gathered, concentrated and extracted into the transaction document. The method is quite similar to how the fancy top chefs reduce their sauces.
From a business law firm’s perspective the main transaction document is the one single document that encompasses all of the disciplines that we work with on a daily basis; contracts, corporate, capital markets, finance, tax, competition, data protection, dispute resolution, IPR, real estate and environment, just to mention a few.
What you need in order to understand and identify the most relevant commercial, contractual, legal and tax aspects of the target business, is people with sound judgment, individuals and teams that can create a relevant overall view. You need insightful people with experience, broad knowledge and cutting-edge technical skills. In my experience insightfulness and sound judgment are key to allowing for a relevant analysis of the vast amount of information available and to identifying the best way to tackle or circumvent the issues in the transaction.
There is another interesting trend as well working in the same direction, the increased focus by companies on CSR – corporate social responsibility. CSR forces us lawyers to give advice that is wiser and more sustainable, and that withstand the test of time. Imagine what this means to us business lawyers! We have a whole new playing field that is no longer limited to what is technically right and wrong. We are increasingly being listened to also when the broader picture is being discussed. We are in the process of reclaiming our position as consiglieri to the key management of our client companies.
The most valuable advice in M&A is rendered by a TPH, a one stop shop insightful, reliable, proactive and dedicated partner to the management of the company going through some of its most difficult and complex moments.
It is quite a challenge! But we at D&I are ready – bring it on – we accept the challenge and are happy to take on the role as your TPH.
D&I: Your TRANSACTION POWERHOUSE