Presale vendor due diligence: Seller know thyself

As buyers more frequently use due diligence to squeeze the purchase price, a growing number of investment bankers are recommending that companies better prepare themselves for sale. Company owners are now considering vendor due diligence—a presale self-investigation of the finances and operations of the target company.

This article looks at vendor due diligence from the  perspective of a financial analyst, an investment banker, and an attorney focused on corporate, securities, and mergers and acquisitions law.  These varying viewpoints provide an understanding of how presale due diligence helps to validate the value of a company, assess and mitigate risks, and provide leverage that can lead to better terms prior to going to market.  And why middle-market companies, private equity firms, and their transaction advisors would consider this analysis that ultimately provides value to the transaction.

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For more information on this topic, or to learn how Baker Tilly due diligence specialists can help, contact our team.