The due diligence process can be relatively fast and straightforward, but it can also be in-depth and drawn out. The “right” amount of (and the right method of) conducting due diligence will depend on a number of factors. You might benefit from legal due diligence services if any of the following are true:
1- You want to enter into a joint venture, or you are considering acquiring or merging with a competitor.
Due diligence can help you ensure compatibility with the target company. It can also help you identify things that may not be readily apparent, such as pending legal actions that could have a material impact on the business post-close date, or potential financial issues that bear further investigation. Thorough due diligence will help you delve into systems, marketing and sales practices, finances, management, and much more, so you go into a proposed transaction with full transparency.
2- Your company is considering entering into a new geographical territory or market.
Legal due diligence services can take on heightened importance if you are considering expanding to a new geographical area. This is particularly true if you will be acquiring or partnering with a company that is located or operates overseas, because due diligence professionals can help confirm that foreign businesses are operating legally in their jurisdictions.
3- You are an investor considering financing a new business.
As with mergers and acquisitions, legal due diligence services can provide would-be investors with a wealth of information, and can help them parse and evaluate that information in order to make informed decisions. As an investor, you do not want to provide capital only to later find out the company was riddled with debt or facing legal or regulatory hurdles. Using legal due diligence services can help investors avoid this type of potentially crippling scenario.
Conducting due diligence is just a smart business practice; outsourcing due diligence services to professionals, who are experienced and adept at looking at and evaluating the types of information uncovered during due diligence, can help you identify and avoid costly issues later. When you choose to outsource the process, you’re also freeing up your time to focus on the business at hand.
To learn about how Baer Reed can help with due diligence, call us today at (888) 433-1990, or contact us online.
- On February 28, 2018
- Back to post list