Due diligence

The need for due diligence procedure occurs usually in connection with scheduling a major deal between the two companies, purchase of business or upcoming investments. Since any of these events can be very important for the company and severely affect its future, a reasonable solution is an implementation of due diligence, thus relieving some of the doubts and allowing to assess possible risks related to the upcoming transaction. In most cases, due diligence involves complex procedures to conduct a comprehensive examination of the various areas of the company in respect of which such major transaction is scheduled.

Due diligence review may be necesary in following cases:

• sale and purchase transaction
  

• mergers and acquisitions (M&A)
  

• purchase of shares and interests;

• applying to the bank for a loan;

• commercial real estate purchase;

• and other financial and commercial operations, which require the objective view of investment object. 

Due diligence review, carried out by the specialists of DELOVOY PROFIL Group, helps to form an objective and neutral view of the investment object. This procedure includes estimation of investment risks, expediency consideration and cost-benefit analysis of an object. Due diligence is one of the most effective tools to reduce risks and protect interests of the parties in significant transactions.

Thus, due diligence is the necessary expertise which allows to avoid serious policy mistakes and minimize all possible risks associated with the deal.

The procedure of due diligence includes the following:

• legal due diligence;
• financial due diligence;
• tax due diligence;
• market due diligence;
• HR due diligence;
• organizational due diligence.

Due diligence review provides parties of transaction with following opportunities:

• to provide potential investor (creditor) with reasonable and valid data on financial soundness;

• to review the reliability of the counterparty;

• to assess risks of investment transaction and to make balanced decision.