Your Buyer's Due Diligence
A potential buyer wants to perform due diligence on my company. What should I expect?
Due diligence procedures vary by industry, deal size and the buyer’s own practices. Generally, you should expect to provide detailed information about your financial and operating results, customers, suppliers, employees and facilities. Other areas may include legal or regulatory issues. The buyer will normally provide you a listing of the data requested. To minimize disruption to employees and operations, you can arrange for a secure data room at an offsite location where the buyer(s) can review the requested information. Unfortunately, many companies considering a potential sale don't anticipate the extensive data requested by potential buyers, so the transaction may be delayed or even terminated due to an inability to provide data in a timely fashion. If you're considering selling your business, consult with your attorney and CPA to identify likely due diligence data needs in advance of beginning negotiations.
