Due diligence is a critical process in any business transaction, providing essential insights into risks, opportunities, and deal structure. Whether you're buying a business, making an investment, or entering a strategic partnership, thorough due diligence protects your interests and informs your decision-making.
What Our Due Diligence Solicitors Can Help With
- Legal Due Diligence: Comprehensive legal risk assessment and compliance review
- Commercial Due Diligence: Business model analysis and market position assessment
- Financial Due Diligence Coordination: Working with accountants on financial analysis
- Regulatory Due Diligence: Sector-specific compliance and licensing reviews
- Tax Due Diligence Support: Coordination with tax advisors on structure optimization
- Environmental Due Diligence: Environmental compliance and liability assessment
- Technology Due Diligence: IT systems, IP, and digital asset evaluation
- Due Diligence Report Preparation: Comprehensive findings and risk assessment documentation
Types of Due Diligence
Buy-Side Due Diligence:
- Comprehensive target company investigation
- Risk identification and mitigation planning
- Valuation support and price justification
- Deal structure optimization recommendations
- Integration planning and synergy assessment
Sell-Side Due Diligence:
- Vendor due diligence to accelerate sale process
- Issue identification and resolution before marketing
- Data room preparation and management
- Disclosure schedule preparation
- Warranty and indemnity risk assessment
Investment Due Diligence:
- Private equity and venture capital investment reviews
- Management team assessment and capabilities
- Growth strategy validation and feasibility
- Exit strategy planning and value creation
- Governance and control structure optimization
Legal Due Diligence Areas
Corporate Structure & Governance:
- Corporate History: Company formation, changes, and restructuring history
- Share Capital: Share structure, classes, and ownership history
- Board & Management: Director appointments, removals, and governance compliance
- Corporate Documentation: Articles, board minutes, and statutory registers
- Group Structure: Subsidiary relationships and intercompany arrangements
Material Contracts & Commitments:
- Customer Contracts: Key customer agreements, terms, and renewal prospects
- Supplier Agreements: Critical supplier relationships and dependency risks
- Distribution & Agency: Channel partner agreements and territorial rights
- Joint Ventures & Partnerships: Strategic alliance agreements and commitments
- Financing Arrangements: Loan agreements, security, and covenant compliance
Employment & Pensions:
- Employment Contracts: Senior management and key employee agreements
- Employee Benefits: Pension schemes, share options, and incentive plans
- Employment Policies: HR procedures, disciplinary records, and compliance
- Industrial Relations: Union relationships, collective agreements, and disputes
- TUPE Implications: Transfer of employment obligations and liabilities
Intellectual Property Due Diligence
IP Portfolio Assessment:
- Patent Portfolio: Patent ownership, validity, and infringement risks
- Trade Marks: Brand protection, registration status, and enforcement
- Copyright & Design Rights: Creative works ownership and licensing arrangements
- Trade Secrets: Confidential information protection and employee obligations
- Domain Names: Digital asset ownership and management
IP Commercial Arrangements:
- Technology licensing agreements and royalty obligations
- R&D collaboration and IP sharing arrangements
- Employee IP assignment and invention policies
- Third-party IP dependencies and licensing risks
- IP litigation history and ongoing disputes
Regulatory & Compliance Due Diligence
Sector-Specific Compliance:
- Financial Services: FCA authorization, permissions, and regulatory compliance
- Healthcare & Pharmaceuticals: MHRA compliance, clinical trial approvals
- Technology & Data: GDPR compliance, data processing, and cybersecurity
- Energy & Environment: Environmental permits, carbon compliance
- Food & Agriculture: Food safety, labeling, and quality standards
General Compliance Areas:
- Health and safety compliance and incident history
- Competition law compliance and market position
- Anti-bribery and corruption policies and procedures
- Tax compliance and HMRC relationship history
- Import/export compliance and trade licenses
Property & Environmental Due Diligence
Real Estate Portfolio:
- Property Ownership: Freehold and leasehold interests and title verification
- Lease Arrangements: Commercial leases, rent reviews, and renewal rights
- Planning & Development: Planning permissions and development potential
- Property Compliance: Building regulations, health and safety compliance
- Property Valuations: Market values and investment yields
Environmental Compliance:
- Environmental permits and license compliance
- Contamination and remediation liabilities
- Climate change and carbon reporting obligations
- Waste management and disposal compliance
- Environmental insurance and liability coverage
Technology & Cybersecurity Due Diligence
IT Systems & Infrastructure:
- System Architecture: Technology stack, scalability, and modernization needs
- Data Management: Data governance, quality, and integration capabilities
- Cybersecurity: Security controls, incident history, and vulnerability management
- Software Licensing: Third-party software compliance and licensing costs
- Digital Transformation: Technology roadmap and investment requirements
Data Protection & Privacy:
- GDPR compliance and data processing frameworks
- Cross-border data transfer mechanisms
- Privacy policy and consent management
- Data breach history and response procedures
- Third-party data sharing and processor agreements
Due Diligence Process & Management
Due Diligence Planning:
- Scope Definition: Identifying key areas and risk priorities
- Team Assembly: Coordinating legal, financial, and specialist advisors
- Timeline Planning: Managing due diligence within transaction timeframes
- Data Room Setup: Organizing information access and review procedures
- Management Presentations: Coordinating management interviews and presentations
Information Gathering & Analysis:
- Document Review: Systematic review of corporate and commercial documentation
- Management Interviews: Structured discussions with key personnel
- Site Visits: Physical inspection of operations and facilities
- Third-Party Verification: Confirmation with customers, suppliers, and advisors
- Expert Input: Specialist technical, regulatory, or commercial advice
Due Diligence Reporting & Risk Assessment
Due Diligence Report Structure:
- Executive Summary: Key findings and critical risk assessment
- Deal Recommendations: Structure optimization and protection mechanisms
- Risk Matrix: Categorized risk assessment with impact and probability
- Legal Issues Summary: Material legal risks and recommended actions
- Commercial Observations: Business model, market position, and growth prospects
- Action Items: Pre-completion conditions and post-completion integration
Risk Categorization:
- Deal Breaker Issues: Fundamental problems requiring deal restructure or withdrawal
- Material Risks: Significant issues requiring specific protection or price adjustment
- Commercial Risks: Business risks affecting valuation and growth prospects
- Compliance Issues: Regulatory risks requiring remediation or ongoing monitoring
- Integration Risks: Post-completion challenges and integration requirements
Due Diligence Costs
Small Transactions (Under £1m):
- Legal due diligence: £2,000-£8,000
- Financial due diligence: £3,000-£10,000
- Commercial due diligence: £5,000-£15,000
- Total due diligence costs: 1-3% of transaction value
Mid-Market Deals (£1m-£10m):
- Legal due diligence: £8,000-£25,000
- Financial due diligence: £10,000-£30,000
- Commercial due diligence: £15,000-£50,000
- Total due diligence costs: 1-2% of transaction value
Large Transactions (£10m+):
- Legal due diligence: £25,000-£100,000+
- Financial due diligence: £30,000-£150,000+
- Commercial due diligence: £50,000-£200,000+
- Total due diligence costs: 0.5-1.5% of transaction value
Why Choose SolicitorConnect for Due Diligence
- Transaction Specialists: Solicitors with extensive due diligence experience across sectors
- Risk-Focused Approach: Identifying material issues while maintaining commercial perspective
- Multi-Disciplinary Teams: Coordinated approach with financial and commercial advisors
- Technology-Enabled: Modern due diligence tools and data room management
- Sector Expertise: Industry-specific knowledge and regulatory understanding
- Practical Reporting: Clear, actionable insights supporting informed decision-making
Thorough due diligence provides essential protection and insights for successful business transactions and investments.
This information is for general guidance only and does not constitute legal advice. For specific legal advice tailored to your situation, please consult with a qualified solicitor.
