Professional Documents
Culture Documents
Mergers and acquisitions (or combinations) refer to a situation where the ownership of two or more enterprises is joined together. A merger is said to occur when two or more companies combine to form a new company. In this, two or more companies may merge with an existing company or they may merge to form a new company.
DUE DILLIGENCE
Due diligence is a process of thorough and objective examination that is undertaken before corporate entities enter into major transactions such as mergers and acquisitions, issuing new stock or other securities, project finance, securitization, etc.
Types of Diligence
The approach to due diligence depends on the type of transaction and what is intended to be achieved. Due diligence may be of various types: Commercial due diligence Reputational due diligence Financial due diligence Legal due diligence
Presentation/background information by the issuer. Sending the issuer a questionnaire. Organizing a due diligence team. Issuer to create a data room (virtual or physical). Review of documentation/ discussion with management. Bring down due diligence questionnaires/calls prior to closing of the transaction.
Identification and mitigation Of risks in light of market practice and legal requirements. Changes in structure of the transaction. Price adjustment. Conditions precedent. Representations and warranties. Verification of disclosures. Retention of purchase price. Indemnity. Conditions subsequent to closing the transaction.
INTEGRATION
BY INTEGRATION WE MEAN THE SELF ANALYSIS A COMPANY CARRIES OUT BEFORE GOING FOR ANY MERGERS.
Post-Merger Integration
To carry off this approach, however, the integration must be: Driven by a crystal-clear vision of the new organization, including its intended mission (core purpose), strategy, and essential values Owned and executed by and with key stakeholders Fluidly coordinated and flexibly self-adjusting Continually providing communication laterally, as well as vertically, across the system and in sync with the needs of ongoing day-to-day operations Open, interactive, and responsive to feedback Cognizant of human needs for inclusion, order, selfcontrol, and choice
RAGHAVAN COMMITTEE
THANK YOU