M&A Document Checklist

If a business decides to sell, they need to conduct due research on the potential buyer. It can be a lengthy process that includes reviewing financial statements, talking to employees and visiting facilities. In this process it is crucial that the company does everything possible to maximize the value https://www.dataroomtech.info/4-best-investment-banking-books-from-industry-experts of the sale. The M&A checklist is a useful tool for companies who are seeking to make a deal.

Term Sheet

A term sheet, also referred to as a letter of intent or memorandum of understanding, is the first step in an M&A transaction. It defines the commercial terms for the deal. These are legally binding documents, and if there isn’t clarity in the form or execution, the deal could result in problems later on.

LOI and Purchase Agreement

The next stage in the M&A process is obtaining the final purchase agreement in place. It is a legal agreement which outlines the conditions of the deal and is signed by both parties to agree to the M&A process. Then comes the M&A due diligence process that involves the review of financial records and other sensitive data in a secured environment.

HSR filings

In accordance with the Hart-Scott-Rodino Antitrust Improvements Act (HSR Act), M&A transactions that satisfy certain criteria must notify the Federal Trade Commission and Department of Justice of their initial premerger announcements prior to closing the transaction. This is to ensure the merger won’t have a negative impact on competition.