An Essential Element in the M&A Due Diligence Process
By Nolan Willis, PMP, LSSBB - IT Due Diligence Leader, BDO, a Partner of M&A Leadership Council
Performing IT due diligence prior to a merger or acquisition has become an essential step to ensure better valuation, financial modeling, and risk mitigation. The primary objective of IT due diligence is to determine if there are insurmountable risks which could impact the transaction or post-transaction integration. The depth and focus of the due diligence should be tailored to the goals of the transaction.
Assess from a CIO Perspective
The due diligence process looks at the IT organization through the lens of the Chief Information Officer (CIO). The need to assess an IT organization in a few days or weeks requires a tailored and systematic approach that focuses on essential areas. By identifying key issues and risks early on, acquiring companies can strategize and develop mitigation options. If analysis indicates substantial impact on the operating model, this information may be leveraged during negotiations.
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