There is limited time and access during M&A due diligence. Knowing this, it is critical to focus on the high priority areas with the largest affect on risk.
As we discussed in our previous article, “Due Diligence for Mergers and Acquisitions – Why include IT“, technology due diligence is a critical part to evaluating a merger or acquisition. The less time spent the higher probability of extended integration or other issues. We now discuss which parts of IT due diligence to prioritize in order to minimize risk.
People
- If the organization you are acquiring has proprietary technology, evaluating the personnel is critical as they support the technology.
As we start to see mergers and acquisitions activity ramp up, we shift focus to the value of technology due diligence.
The U.S. economy’s worst recession in the post-war era has begun to turn for the better. Yet, despite the fact that the doom and gloom of the past 20-plus months may be behind us, entrepreneurs seeking to buy businesses still find it difficult to get banks to finance their purchases.
Buying an existing business is a good option because it saves the buyer from hard work establishing a new business and promoting it. Buying an operating business is always considered a way of less risk because it brings a lot of current customers with itself.
