Vendor due diligence

What is vendor due diligence?

Vendor due diligence is an independent and thorough review of a business being offered for sale. It is commissioned by the vendor but is designed to provide a detailed assessment of the business and is intended to answer questions that could potentially be asked by a buyer.

Vendor due diligence can make an important contribution to the achievement of a successful sale. Designed for sending to prospective buyers, the documents contain vital information from unbiased experts. Aimed at generating better-informed bids and reducing the risk of future price reductions, they also highlight early in the process, issues which could affect not only price but the deal itself.

Why use it?

It helps the vendor maintain control of the sale process.

• Potential deal issues are highlighted early so that they can be resolved before purchasers have access to the business and presented in a balanced manner.
• It minimises disruption to the business by reducing the need for purchasers to conduct their own due diligence.
• It is understood by the market as an independent report – ultimately it is signed over to the purchaser.
• Ensures that commercially sensitive information is disclosed in a controlled manner.
• Maintains competitive tension during the sale/auction process and helps maximise price.

How we can help

BDO specialises in the provision of due diligence in the mid market. We provide robust and independent reports that are well known and trusted in the market place. We have a deep understanding of a buyer’s perspective, allowing us to tailor a scope of work to assist in an efficient and effective transaction process.

We work with clients to assess what is the most appropriate method of preparing a company for sale – this may not always be vendor due diligence. Our commitment is to provide objective and robust advice to help clients complete the right deal at the right price. For further information contact Chris Grove direct on 020 7893 2163.