Due diligence

Fundraising (1)

Fundraising (2)
Pan european management buy-out
Reorganisation, tax planning and investment
Sale

 

Introduction

We were approached by one of our contacts (solicitor) to perform a due diligence review of a prospective target company.

In advance of the appointment we provided indicative checklists and costs. It transpired this was a referral from another firm of solicitors and was a Malaysian company that was a world authority on exotic mushrooms.

Due to the likely timescale and remoteness of the client it was agreed to accept the assignment provided we were appointed by the solicitors and reported to them.


Appointment

Final appointment was confirmed on Wednesday but the initial report was required the following Tuesday for the acquirers visit to the UK.

Initial instruction letters were drafted and the target contacted to arrange timings. All records were relatively local but the farms were in Lancashire. It was agreed with the client that the initial report would be based solely on a local visit and a review of the auditor's files.


Work

Review of records and enquiry of management was undertaken on the Thursday and Friday with the review of auditor's files occurring on the Monday. The report was emailed to the solicitor Monday night ready for the client meeting on the Tuesday.

The report highlighted areas that the purchaser needed to be aware of and we were requested to visit the sites in Lancashire and complete the report accordingly.


Resolution

Whilst there are still issues underlying the capital nature of the deal, the quick response on business related issues that were raised allowed the client to appreciate the business that was being bought and the limitations that it faced was valuable in assessing the transaction.

The total timescale from appointment to issuing the final report was 21 days.