DD – Does it simply confirm a decision already made

This topic contains 2 replies, has 3 voices, and was last updated by  Johanna Breinesberger 1 week, 6 days ago.

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    Clifford Newton

    I’ve been involved in several due diligence cases and in everyone the obvious conclusion was not to purchase, yet the owner had already made up their mind regardless. I therefore question the need for the activity.


    Mandana Javaheri

    That shouldn’t be the case although I have experienced few acquisitions where the DD was done after the decision was made. In my opinion the DD should drive the decision not the other way around


    I agree with the observation Clifford has made – if a CEO/owner/investor wants to buy a company, they often will, even if the DD results strongly suggest to move away from the deal. There is a lot of ego coming in the way.
    Here the decision makers have to work on themselves and set thresholds in the beginning what their absolut minimum requirements are.

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