Conducting Sell-Side Due Diligence Yields Best Results

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In today’s fast-paced and highly competitive M&A environment, deal-makers want to close their deals quickly and smoothly at the desired valuation. With deal volume declining, buyers are being more selective when acquiring companies.

As a result, private equity firms looking to exit a portfolio company are increasingly seeing the benefit of conducting a sell-side due diligence process. The key benefits of sell-side diligence are facilitating a more efficient transaction and allowing the seller to be equipped for conversations with buyers about the company’s financial and tax matters.

By conducting sell-side diligence, sellers gain a better understanding of the company’s strengths and weaknesses and are able to present financial information to buyers with confidence.

The information gleaned from the process gives the seller the ability to create a dialogue with potential buyers on key points that should be highlighted and approach head-on any hard conversations and questions about potential company weaknesses.

Additionally, having sell-side diligence completed can significantly reduce the burden on the seller to respond to multiple buyer’s document requests and redundant queries.

Learn more about how sellers can optimize the outcomes of their deals.

This article represents the author’s views only and doesn’t necessarily represent the views of PitchBook.

By Marc Logan, Partner, RSM

Article by PitchBook