Carve Out due diligence

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  • #111160

    Hello everyone,

    I’m currently involved in a carve-out transaction and am facing some significant challenges because the seller hasn’t engaged any advisors. This situation has raised several concerns, particularly regarding the Transitional Service Agreements (TSAs) which would be the buyer’s responsibility.

    I wanted to open up a discussion to gather insights and advice from those of you who have faced similar situations.

    1. Information Accuracy:
    – How do you ensure the accuracy and completeness of the data provided by the seller when there are no advisors to verify it?
    – What strategies or tools have you found effective in identifying and addressing discrepancies in financial and operational reports?

    2. (TSAs):
    – What are the best practices for negotiating TSAs when the seller hasn’t defined clear terms?
    – How do you estimate the costs and manage the risks associated with TSAs in the absence of detailed information from the seller?

    3. Valuation Challenges:
    – Without the expertise of seller advisors, how do you approach the valuation of the carved-out business?
    – Are there specific valuation methods or industry benchmarks that you rely on in such cases?

    4. Operational and Compliance Risks
    – What are the most critical operational risks to look out for in a carve-out transaction without seller advisors?
    – How do you ensure regulatory compliance and identify potential legal issues during due diligence?

    I’m looking forward to hearing about your experiences and any advice you can offer on navigating these challenges. Thanks in advance for your contributions!



    from the above and learnings shared in the course, it would be in the Buyer’s interest to engage specialist or Subject Matter Experts (Auditors, Legal, Accountants, etc.) to advise the Buyer on concerns.

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