Due Diligence – Legal Review of Companies and Assets
We conduct due diligence reviews for M&A transactions, private equity and venture capital investments, and business or asset acquisitions. Our team’s experience includes several hundred legal reviews of companies and assets across diverse economic sectors.
We tailor the scope of our analysis to the planned transaction. In our report, we describe identified risks, evaluate their commercial impact for the investor, and propose actionable solutions. We highlight issues requiring remediation before closing, as well as those that should be reflected in valuation, indemnity protections, or contractual liability terms.
Buy-Side and Sell-Side Reviews
On the buy side, we verify the legal standing of the target business and liabilities that could impact the investment. We leverage our findings to negotiate representations and warranties, specific indemnities, and key contract terms.
On the sell side, we perform vendor due diligence. Early identification of legal issues gives owners time to resolve risks and organize documentation prior to investor review. We also assist in setting up virtual data rooms (VDRs), establishing information sharing protocols, and managing Q&A sessions with potential buyers.
Industry Sector Experience
We have reviewed companies operating across sectors including:
- FMCG and manufacturing, including fittings, packaging, glassware, and carpets;
- financial services, electronic payments, consumer lending, leasing, and asset management;
- e-commerce, IT, and emerging technologies;
- medical services and healthcare;
- transportation, logistics, and infrastructure;
- real estate and property development;
- insurance, physical security, cash-in-transit, and cash management services.
Scope of Legal Review
Corporate Governance and Ownership Structure
We review incorporation documents, corporate registry histories, and legal title to shares or stock. We examine shareholder resolutions, representation rules, and corporate documentation material to the transaction.
Commercial Contracts
We analyze contracts with customers, suppliers, and key business partners. We evaluate termination rights, contractual penalties, non-compete clauses, and change of control provisions. We identify agreements requiring counterparty consent or transaction notices.
Intellectual Property, Technology, and Data Protection
We examine rights to trademarks, patents, software, and other proprietary works. We review employment and B2B agreements, licensing terms (including open-source software), and post-transaction IP availability. We also assess GDPR compliance and legal cybersecurity requirements.
Real Estate and Tangible Assets
We verify legal title to real estate, land register entries, encumbrances, and lease or tenancy agreements. We review construction, environmental documentation, and legal title to key equipment and machinery.
Employment and Human Resources
We examine employment contracts, management agreements, B2B engagements, internal workplace regulations, and labor disputes. We evaluate misclassification risks associated with contractor structures and verify IP rights assignment from employees and contractors.
Financing and Security Packages
We review loan agreements, credit facilities, leasing contracts, bond documentation, and security packages. We examine debt covenants, restrictions, and the impact of the proposed transaction on ongoing financing obligations.
Litigation and Regulatory Compliance
We analyze pending judicial, arbitration, and administrative proceedings, as well as potential dispute exposures. We verify operating permits, concessions, licenses, and matters pending before supervisory and regulatory authorities.
Reporting and Advisor Coordination
We evaluate legal risks in light of their practical business and transactional impact. The due diligence report details pre-signing conditions, matters to be addressed in transaction documentation, and post-closing integration actions.
We can coordinate tax and financial due diligence conducted by external advisors. During contract negotiations, we integrate findings across legal, tax, and financial streams. We clarify the practical implications of findings to support client decision-making.
In our document review process, we utilize workflow automation tools, including AI-supported solutions, with all outputs rigorously verified by our lawyers. Project scopes, timelines, and fee arrangements are established based on company complexity and document availability. Fixed-fee arrangements can be structured for agreed parameters.
Questions and Answers
What is the difference between a red flag report and a full due diligence report?
A red flag report focuses exclusively on key material risks and their immediate transaction impact. A comprehensive report additionally provides a broader description of legal status across all agreed review areas. The distinction lies primarily in presentation depth and agreed reporting scope – a red flag report involves thorough document examination, but concentrates reporting strictly on material deal-breaker or high-impact risk issues.
How do due diligence findings translate into the purchase agreement?
Findings may result in purchase price adjustments, specific representation and warranty terms, target indemnities, or additional security arrangements (such as escrow retention). Parties may also agree on specific pre-closing conditions precedent requiring the seller to remediate identified issues. Structural solutions are customized to the nature and severity of each identified risk.
Why is vendor due diligence conducted?
Vendor due diligence allows sellers to proactively identify legal issues likely to concern prospective investors – such as missing IP assignment deeds, incomplete corporate records, or restrictive commercial contracts. Addressing these issues prior to negotiations streamlines buyer reviews, facilitates prompt Q&A responses, and reduces the risk of transaction delays.
What is examined in change of control clauses?
We analyze the contractual consequences triggered by a change in company ownership or control. Change of control provisions may require counterparty notices, prior written consent, or grant the counterparty termination or debt acceleration rights. The precise wording of each clause determines whether the planned transaction falls within its scope and what pre-closing actions are required.
