Mergers and Acquisitions include a host of due diligence activities prior to taking over another business. The business owner needs to understand the business it plans to take over along with the commitments it is about to accept. Along with this, the owner needs to understand the organization’s liabilities, tricky agreements, case dangers, intellectual property rights and much more. This is especially important in privately owned business since it hasn’t been under the public eye yet. So, what are the activities involved in due diligence services in Dubai? Let us take you through it.
1) Overview of the target company: It is essential to understand the details of the target company, in terms of was it sold earlier, what are the goals of the company, how complex are the internal structures within the organization, the geographical structure, and the reason for selling the company.
2) Financials: Next up, get into the financials. Are they audited? If yes, what do the statements imply? Go through the financial projections to understand their reality, understand the expenditures and the investments. Another important thing to note is if the target company has enough financial resources to go through the cost expenses for the deal?
3) Technology/Patents: If you are convinced with the financials and the business – check out the technology and patents, if it has any trademarks, licenses or copyrighted products.
4) Strategic Fit: Next up, you need to understand how it will fit within your existing company in a strategic manner. What is the newness this will help bring in your existing line of business? Understand the dynamics before setting foot into the merger or acquisition.
5) Management: When merging with or acquiring another company, due diligence in Dubai also includes reviewing the management and the workforce, the compensation structure, the benefits, incentives and the different policies set forth by the target company.
6) Legal Issues: Look out for any pending, threatened or settled litigations, or if there are any claims against the company, or if they have had any past settlements. You must be aware.
Apart from this, due diligence also involves going through
the environmental matters, the marketing strategies, production capabilities, or
any other corporate matters. If you are looking for effective due diligence
services in Dubai, check out PKF UAE, one of the leading accounting and
consulting firms in the UAE.
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