Our Transaction Services (TS) team provides dedicated support for transactions. This typically involves buy side or sell-side due diligence to ensure significant value items, risks and other matters to assist our client or prospective purchasers to make an informed decision regarding their transaction.
Our team provides services to both Corporate and Private Equity clients, combining our core financial due diligence expertise with the broad experience of our wider firm.
Transaction Services Bid Support
We work alongside clients where they are one of a number of bidders in a competitive auction. We provide support in analysing the key issues likely to influence their bid, involving other specialists as necessary. Once our client is given exclusivity we will perform acquisition due diligence to assist in completion of the deal. Our work at this stage tends to be confirmatory in nature but will also seek to identify issues that affect price, or those that require reflection in the sale and purchase agreement and completion accounts. We may also identify opportunities to capture value in the post acquisition phase and where our Post Merger Integration Team can ensure merger benefits are captured.
Acquisition Due Diligence (ADD)
Acquisition due diligence engagements provide potential purchasers with analysis of targets in the areas covered by our scop of work. Our flexible approach offers potential purchasers the opportunity to focus our investigation upon core areas of concern, or more widely to provide a fuller diligence exercise.
- Being focused on the needs of the potential purchaser, acquisition due diligence engagements often identify items or provide analysis to support the purchaser in negotiating adjustments to the proposed purchase price.
Vendor Due Diligence (VDD)
- Vendor initiated due diligence is designed to add real value to a well-managed sales process when there is likely to be a number of interested bidders.
- Commissioned by vendors but provided to bidders, VDD provides the seller a degree of control over the sale process, minimising disruption to the management team which will just have the VDD accountants performing diligence, rather than accountants representing each potential purchaser.
- The vendor also gets to review the VDD report as part of our review procedures, helping to ensure factual accuracy.
- The VDD report will ultimately be signed over to the successful purchaser on a reliance basis, making them our client. Producing VDD reports therefore requires that we maintain our independence in our dealings with the vendor and that we raise identified weaknesses in the target business that would be of interest to a purchaser in much the same way as we would through an acquisition DD engagement.
- Meetings between the VDD team and potential purchasers (Bidder meetings) are common in this type of engagement following delivery of our report to help bidders to better understand the target business and as an opportunity for them to ask questions of our team about our findings and the VDD process generally.
Sale and Purchase Agreement (SPA)
Our Sale and Purchase Agreement (SPA) team can help you if you are working hand in hand:
- proposing or reviewing a purchase price adjustment mechanism;
- dealing with a “locked box”;
- pondering the impact of “cash and debt free”, “target net assets” or “earnouts”;
- in need of advice in setting the level for target working capital;
- considering the financial definitions for inclusion in a transaction contract;
- reviewing or drafting accounting policies and hierarchies or procedures.
Working hand in hand with the core Deloitte team we are very close to the numbers and financial dynamics of the business early in the process. We are therefore ideally placed to identify critical commercial issues at a time when they can be converted into real value.
Increasingly, on large M&A transactions, our clients are demanding a wider range of services from their advisers to support the disposal process. We have developed a separate Vendor Assistance service to provide a comprehensive offering to mitigate potential impediments to sale whilst de-risking and shortening the transaction process. It can be either a precursor or instead a vendor due diligence, depending upon the specific circumstances of the transaction.
Vendor Assistance is the provision of any combination of a number of value add services, including:
- Accounting advisory services;
- Carve out;
- Data room support;
- Exit readiness review;
- Operational and commercial reviews;
- Pensions and vendor assistance;
- Project management;
- Risk review;
- Sale and purchase agreement advice;
- Tax vendor assistance;
- Vendor modelling.
What are the benefits of Vendor Assistance?
The aim of Vendor Assistance is to provide ongoing support to a company that is considering the sale of all or part of its business. We are able to provide support in all areas to:
- assess whether or not the business or business units are ready for separation and divestment, following an initial diagnostic;
- identify the major areas where separation activity is required;
- understand the applicability of existing or past plans for proposed separation;
- work with the vendor to establish and execute a carefully coordinated operational carve out plan;
- provide assistance to prepare standalone financial information for the carved out business, including tax information, that is robust and fit for a sale purpose in terms of audited carve out financials, vendor due diligence, data room and valuation model;
- help to keep lines of communication open by providing resource centrally and in country;
- keep control over the timetable at all stages of the project, including due diligence if vendor due diligence is undertaken;
- advise on best practice during a disposal process e.g. restrictions on communications with potential purchasers;
- provide hands on support through all stages of the sale process, including bidder meetings, advice on the sale and purchase agreement and completion accounts.