We are able to undertake legal due diligence and provide purchasers and investors with reliable information to allow them determine the current status and consequences of the contemplated transaction.
Acquiring a business, its shares or assets may bring new opportunities but may also entail hidden dangers for the acquirer. A prudent investor will seek to minimise risks by carrying out legal due diligence.
Legal due diligence is an essential part of corporate transactions (for example mergers and acquisitions, public offerings of securities etc). It allows investors or businesses considering making an investment or purchase to obtain information to allow them to analyze the financial, structural and operational aspects of the target asset.
A Legal due diligence gives the investor/acquirer an opportunity:
- to understand the target assets or company and its operations;
- to asses whether they wish to proceed with the transaction or ring fence, exclude or limit the risks, and negotiate warranties or the purchase price.
- to identify issues which can act as impediments to closing the deal (eg provisions in constitutional documents or applicable laws which may restrict the proposed transaction).
- to incorporate appropriate clauses and provisions in a commercial agreement to overcome any obstacles identified.
Depending on the nature of the target asset of the proposed transaction, the following documents maybe required to be reviewed:
- constitutional documents;
- Internal registers;
- documents associated with officer or partners and employees;
- documents relating to assets and liabilities;
- commercial agreements.