When considering an acquisition, the buyer needs to check all the assumptions it makes about that business. If your company is up for sale (or you are selling off one of its parts), you need to show an in-depth report on its financial health to potential buyers - this is vendor due diligence.
All businesses involved in a buy-side acquisition need to ensure that the financial information they hold is as accurate as possible, not only to prevent paying too much in a buyer's case, but also to ensure that their governance and risk management objectives are met.
As deals are inherently complex and laden with “hidden” risk, stakeholders do not always get the Enterprise Value anticipated from their Transaction. This is due to the inherent “information gap” between buyers and vendors in every deal. You can mitigate risks, bridge the information gap and maximise returns on deals by commissioning a financial due diligence.
Director of Deals, PwC Latvia
Tel: +371 67094400