A Step that Tells the Financial "Story" of a Business
By Tom Jones, Partner, Transaction Advisory Services, BDO USA LLP, a Partner of the M&A Leadership Council
There are clear benefits to performing sell-side due diligence in connection with the sale of a business. More sellers are investing in sell-side financial due diligence as a key component of a well-run sales process which, for many reasons, there is no substitute for when it comes to selling a business. With sell-side financial due diligence:
- Buyers tend to have more confidence in financial data and thus the EBITDA and cash flow information they are presented with and will use to form a view on valuation.
- The risk of unwanted surprises during the buyer due diligence process is significantly reduced.
- There is a high likelihood of increased speed and certainty of the contemplated transaction closing.
Firstly, what is sell-side financial due diligence?
Sell-side financial due diligence, often referred to as sell-side quality of earnings analysis, is typically a process whereby a seller engages an independent third-party service provider to undertake a financial due diligence analysis with respect to its business, as if it were from a buyer’s perspective. Read more.
To learn more about due diligence, join us for The Art of M&A Due Diligence, a workshop that brings together M&A experts from firms like BDO, to share their insights and experience. Learn more.