Successful acquisition –
risks under management
An acquisition is a situation worth using
external expert. There will be situations in the acquisition where
your own skills or knowledge are not at a sufficient level and you cannot afford unpleasant surprises.
In these situations, for example, a private equity investor or a buyer
on behalf of the company, JS RiskAdvisers Oy acts as an advisor.
Content of the Service
In the Due Diligence phase, we find out the status and level of the object’s operational risk management solutions so that any problem areas that affect the purchase price or the buyer’s balance sheet at a later stage
and risks are identified.
We are part of the customer’s M&A team, the composition of which is built on the risk profile of each company traded.
The most common phase of the Due Diligence phase is finding out the level of risk management, damage history and existing risk management solutions. It can be used to assess the risk profile of an object, identify potential problem areas and uninsured risks and assess their impact. We examine the current risk costs before the transaction and estimate the post-trade risk costs so that they can be taken into account
in the actual price negotiations.
Why Due Diligence and benefits of it?
The purpose of the due diligence study is to identify the risks and potential obstacles (deal breakers) and positive opportunities associated with the proposed merger. The information obtained will be used in trade negotiations, the drafting of a trade agreement and the determination of the purchase price and possible withholding of the purchase price.
Due diligence can be performed by both the buyer (buy side due diligence) and the seller (vendor due diligence).
Expert due diligence is a prerequisite for a successful acquisition and benefits both the buyer and the seller.
Tools in the M&A process!
There are several “grey areas” in the acquisition, some of which can be e.g.
manage and/or insure. Thanks to the insurance, the risk is transferred in this respect to be borne by the insurer. Because of insurance solutions the price tag for the risk can be calculated and choose which party pays for it.
Representations & Warranties of these insurance solutions
-insurance is the most common in the Nordic countries.
For example, in SPA can be raised outside the acquisition product-related product liability risks, patents and other
the validity of intellectual property rights and environmental responsibilities.
