Acquisitions investment review process

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    CHOON LIANG TAN
    Participant

    Working in PE, our firm utilizes a relatively structured investment review process between the various stage-gates along the deals cycle. This typically means:
    1. Pre-deal screening & search – identifying key potential targets
    2. Deal intro – lead deal team preparing prelim, high-level assessment of the deal parameters to gauge the investment committee’s (IC) approval to pursue. This is usually followed by an NBIO or term-sheet with the target acquisition
    3. PIR (prelim investment review) – formal approval process with IC before we kick-off detailed due diligence activities, including investments into potential consulting firms and advisory services for areas such as commercial, legal, operational, IT, legal, ESG due diligence
    4. FIR (final investment review) – formal final approval process with IC to address key items raised following the DD activities and answering open items from the PIR. This is also where key areas of potential earning’s growth for return on this investment, are identified & sized up including which key initiatives will be driving those earning’s
    5. Deal closing – final wrap-up of the deal and closer of the acquisition. Typically this also means a VCP and 100-day plan

    Curious what other practices other firms may be using as part of their investment review processes for M&As.

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