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Transactional Support & Due Diligence

Whether a technology company is participating in an equity raise, debt financing, acquisition, or sale, there will be a requirement to perform, or be the subject of, due diligence.

Buy-Side Due Diligence
Due diligence plays an essential role in the decision-making process when considering to buy or invest in a technology company. Due diligence is vital to identifying business risks, confirming valuation, and quantifying synergies. KROST’s team of experts will help:

  1. Assess the target's quality of revenue, profits, and cash-flow
  2. Analyze the target’s quality of assets and liabilities being acquired or assumed
  3. Evaluate the historical use and future needs of working capital
  4. (1), (2), and (3) are normally delivered through a Quality of Earnings Report.
     
    In addition, we can:

  5. Identify internal operational weaknesses of financial systems and personnel
  6. Analyze and test the target's financial projections
  7. Create a pro-forma projection of the combined companies
  8. Highlight potential deal-breakers
  9.  
    For non-financial due diligence, the KROST team can provide due diligence on:

  10. Personnel - assessing the experience and skill set of managers and senior business leaders
  11. IT infrastructure and cyber security implementation

 
Sell-Side Due Diligence
For companies who are contemplating the sale of a Company ; or re-capitalization - selling a portion of the business, but still retaining some equity; or an equity raise – getting a capital investment through the sale of new shares; and/or debt financing - getting capital through a loan, should consider sell-side due diligence.

Sell-side due diligence prepares the Company for the type of investigation that a buyer/investor will perform as part of their due diligence. By identifying potential issues ahead of the final stages of a transaction, there is more time to make adjustments and corrections.

Sell-side due diligence can vary in scope and depth of review – the key is to focus on potential issues that may be seen, by the buyer/investor, to increase the risk of the acquisition/investment or to reduce the perceived value of the business.