Legal Due Diligence
CERBERUS Legal team provides legal, due diligence services, collecting and assessing all legal documents and information relating to the target company. It allows both parties to scrutinize legal risks, such as lawsuits or intellectual property details, before closing the deal. By understanding the target company and any potential liabilities, both parties can make an informed decision in the M&A transaction.
Legal due diligence benefits not only the buyer but also the seller. As the seller, it enables you to identify the worth of your company and prepare it for sale. This is especially crucial since nearly half of the deals fail due to issues that surfaced during the due diligence process. If the sell-side can perform due diligence on their own company first, issues can be identified and rectified before a buyer or investor gets involved. The result for the buyer is a more streamlined, less frustrating process. For the seller, it often equates to a higher-value deal.
The benefits of this type of due diligence are four-fold for the acquiring company. First, it enables the buyer to understand the target company and its operations. This then aids the buyer in determining a fair purchase price but helps to prepare a strong M&A contract.
And most importantly, with a thorough understanding of the target's potential legal risks and liabilities, you can make an informed decision and avoid falling into hot water later down the track.
Legal Due Diligence services include:
- Contracts and agreements review (customer, supply, operating and employment contracts and licenses)
- Leases
- Pending and potential lawsuits.
- Intellectual property and Patents
- Property and Tax liabilities
- Environmental Laws
- Representation and warranties.
- Organizational documents (company by-laws and corporate agreements)