If a company decides that it is going to sell, it must conduct its due diligence regarding potential buyers. This could be a lengthy process that involves examining financial statements, talking to employees and touring facilities. During the process, it’s important that the company does their best to extract the most value from the sale. The M&A checklist is a valuable tool for businesses contemplating a merger.
Term Sheet
A term sheet can also be called a memorandum or intent and it outlines the commercial terms of the contract. These are legally binding documents, and when there isn’t a clear understanding in the writing or execution, they could cause issues in the future.
Purchase Agreement and Letter of Intent
The next step in the M&A process is obtaining the definitive purchase agreement in place. It is a contract that defines the terms of the M&A deal and is signed by both parties who agree to it. The M&A procedure is then followed by due diligence, which entails reviewing financial records in an environment that is secure.
HSR filings
In accordance with the Hart-Scott-Rodino Antitrust Improvements Act (HSR Act), M&A transactions that meet certain requirements https://www.dataroomtech.info/4-best-investment-banking-books-from-industry-experts must notify the Federal Trade Commission and Department of Justice of their initial premerger announcements prior to closing the transaction. This is to ensure that the merger will not have a negative impact on competition.
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