Due Diligence: A Practical Guide Hardcover – 15 Dec 2008
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About the Author
Vanessa Williams, Partner, Bates Wells & Braithwaite LLP
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An appreciation by Phillip Taylor MBE and Elizabeth Taylor of Richmond Green Chambers
Much have we heard of due diligence of late. As expert author Vanessa Williams explains, the difficult economic conditions of recent years ‘have lifted due diligence to higher prominence’. One might add that in the wake of stringent and very recent anti-bribery legislation, awareness of the dire necessity for due diligence is now very prominent indeed.
In this clear and concise work of reference, the author describes due diligence as ‘the process of investigation through which a potential purchaser gains a complete understanding of the target business or its assets for acquisition, evaluating both the strengths and the weaknesses of the business and reaching conclusions as to whether to proceed with a purchase, reduce the price or restructure the transaction.’
Based on the time-honoured principle of ‘caveat emptor’ due diligence is a process by which, for example, solicitors and other parties working on mergers and acquisitions, management buy-outs, or buy-ins, or other corporate financial transactions, check out the company they may seek to acquire -- and a very thorough and systematic check it is.
Writing in the preface, Williams notes that, interestingly, there is often a slight disconnect between the need for a rigorous, thoroughly professional and essentially watertight due diligence process and what she has observed as the relative inexperience of the practitioners who typically carry it out, many of whom are at the beginning of their careers. But what they may lack in in-depth understanding of due diligence, however, might be made up for by their acquiring a copy of this book.
The book’s sub-title is indicative. It is indeed a step-by-step manual of the complete due diligence process from start to finish. Here in a single handbook is everything that the company and its professional advisers need regarding the transaction itself, as well as points of concern, precedents and potential pitfalls.
Approximately one quarter of the guide takes the reader through the procedure itself, including reviewing all relevant information, from accounts… to general and intangible assets to… yes, anti-bribery and corruption and other issues including real property and software. Further specific issues, including post-completion issues, are examined in depth.
The remaining three-quarters of the book then goes on to list sample documents and explanatory notes supplemented by general and specific comments. Included in the accompanying CD ROM, this section functions as a due diligence toolkit; indispensable, we would say, for anyone involved in the due diligence process, from novices to experienced practitioners.
Note that this new, second edition of this authoritative work reflects recent changes in legislation and provides sharp and timely warnings of potential traps and pitfalls. With its practical, business-focused approach, this book should be considered a must-have purchase for practitioners or advisers wishing to enhance their understanding of the due diligence process.
The law stated is accurate at December 2012.
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