Library topic
Due diligence
Request lists, data rooms, question logs, personal data and findings: how diligence runs on both sides of a deal and what each area tests.
5 pieces
- Running a virtual data room without chaosGuide · 5 minA data room fails in familiar ways: duplicate files, the wrong people seeing the wrong folders, and nobody sure what the buyer has already read. An agreed folder index, access by role and a few upload rules prevent most of it.
- What a quality of earnings review looks atGuide · 7 minBuyers rarely accept reported profit as it stands. A quality of earnings review adjusts it for one time items, owner costs and accounting choices, and checks it against cash. A seller can prepare the same schedules in advance.
- Related party transactions in diligenceGuide · 6 minIn many family run Indian businesses, the company buys from, sells to or rents from companies owned by the same family. Buyers want to know whether those terms are fair and whether they will continue, so the dealings are best put in order before a sale.
- Diligence documents and the DPDP ActArticle · 7 minDue diligence moves a lot of personal data from the seller to buyers and their advisers. Under the Digital Personal Data Protection Act, 2023, that needs a plan: what to share, in what form, with whom, and what happens to it afterwards.
Terms to know
The words you will hear on this part of a deal.
- Data room
- A secure place where the seller shares documents with buyers and their advisers, with access controlled by role and every view recorded.
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- Request list
- The buyer's list of documents and information needed for diligence, organised by area and tracked to completion.
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- Disclosure letter
- A letter from the seller listing exceptions to the warranties. Anything fairly disclosed usually cannot be the basis of a later claim.
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- Change of control clause
- A clause in a contract, lease or loan that lets the other party end or renegotiate it if the ownership of the company changes.
- Quality of earnings
- A review of how real, repeatable and cash backed a company's reported profit is.
- Read more
Next step
Working through this on a live deal? Talk it over with an adviser.
A thirty minute confidential call with an adviser. You leave with the steps, the documents you will need and where the risks usually sit.