Deal makers recognize that successful deals require superior strategies, comprehensive due diligence, and well-developed integration plans. In mergers and acquisitions (M&A),parties on sell and buy sides need convenient access to sensitive documents to complete the due diligence process and meet target closing dates. Here’s how the M&A data room helps during each stage of due diligence:
Before the M&A is planned, the seller prepares the virtual data room and uploads pre-marketing documentation so that it will be available at short notice to potential investors in order to facilitate due diligence.
Historical information, compliance documentation, and other crucial records are distributed to the users of the data room. During this process, potential buyers may ask questions about documents or even request additional ones. Once due diligence is completed, the deal is closed and the content of the virtual data room is archived.
The virtual data room helps merged companies integrate their financial, legal, IT, and other departments. As the new company continues its growth, the virtual data room serves as a corporate document repository and assists in executive communications.
Today, Virtual Data Rooms (VDRs) have become the industry standard for secure document sharing. Compare to a physical data room, VDRs save travel time and expenses, and make document access easier and the access management less costly. More importantly, virtual data rooms enable several deals to be conducted at the same time within a shorter period.
Some vendors erroneously label their file-sharing services as “Virtual Data Rooms”. Indeed, these two products seem to be quite similar at first glance. However, there are some important aspects that differ both of them: the level of security and possibility to control virtual environment.
The thorough process of preparation work normally precedes due diligence. Nevertheless, in a modern business world, it often happens that a deal occurs when no one expects it. There is no surprise that most dealmakers trust to work with virtual data rooms in such robust and intense environment. In most cases, Virtual Data Room can be opened within 30 minutes and most of them would offer multilingual access, mobile user interface and many other convenient options.
The use of Virtual Data Rooms makes easier the process of compliance with some legal requirements such as Sarbanes-Oxley Act. Whether the main concern is often an obligation to provide all documents required by the law, the VDR provider usually has legally compliant due-diligence index templates that help seller with documents preparation phase of an M&A deal. Once documents are prepared and uploaded into the VDR, they become accessible for all prospective buyers and every action with the document is tracked by the system. After a deal is finished, both parties, sell-side and buy-side can be provided with the DVD or Flash-drive archive of the documents accompanied by audit trail reports of their detailed activities which can be used as the evidence in case of legal dispute.
When upload of all necessary information is completed, deal documents should be well-organized and named so buyers can easily find them.
Throughout the deal, users are continuously added and their access can be constantly changed. Invite participants and assign their access permissions quickly so bidders can begin and complete their due diligence sooner.
Insufficient or delayed due diligence process could be a source of risk when pursuing a deal. With the iDeals Virtual Data Room, the deal makers and corporate executives can leverage cutting-edge technology in order to anticipate different scenarios in accelerated pace of modern M&A deals. iDeals Platform enables them to: