Importance of Legal Due Diligence Report
Preparation & issuance of high level due diligence report is a crucial component to significant corporate transactions.
|Published on: 30 April 2018|
Preparation & issuance of high level due diligence report is a crucial component to significant corporate transactions, in relation to, amongst others, Mergers, Acquisitions, public offering of securities, debt financing.
Legal due diligence is essentially the investigation into a company’s affairs and it is conducted by reviewing the Company’ structure and records, as well as all of the Company’s agreements, funding arrangements and constitutional documents.
In the context of a legal due diligence the first step would be to conduct a search against the public files of the Company kept with the Registrar of Companies. The information extracted is then used to confirm whether or not to establish and whether the records of the Registrar are consistent with the Company’s records. Upon the finalisation of the investigation, a practicioner will invariably draft a report in which the practicioner shall list all the key findings that, in the practiconer’s view may assist the interested party, usually the potential buyer, to reach an informed decision in regards to the transaction in question.
Legal due diligence report may also be requested by the management of a company for the purpose of having a better understanding of the company and its value before entering into a merger or the sale of the business.
Moreover, it is crucial for any potential buyer to be able to have such report by having a full assessment of the possible legal risks and indication of the value of equity, assets and of course of any potential problems or liabilities that may arise in the future, before purchasing the company.
During the legal due diligence procedure, we are examining, amongst others, the following documents:
- Constitutional Documents (Memorandum and Articles of Association);
- Any documents affecting the shareholding structure;
- Share Certificates;
- Registrar of Companies corporate certificates;
- Powers of Attorney;
- Any documents associated with the Directors, Secretary and employees, if applicable, of the Company;
- Any documents in regards to acquisitions, investments, disposals and mergers;
- Commercial contracts;
- Funding agreements;
- IP documents.
It is very important in a due diligence report to present the findings, describe all the reviewed documents, analyse the key issues and provide our comments, recommendations and/or solutions for any issues that might have arisen during the review process
Source: S. Evangelides & Partners LLC
Return to Press Page
About Investment-Gateway.euOne contact, multiple options
Established in 2011, Investment Gateway is an independent and impartial hub and initial point-of-contact to leading supplier-firms in Cyprus that provide professional services for investment purposes, including company formations, subsequent company administration and maintenance services, accounting and auditing, global tax planning, wealth management, as well as international banking. Investment Gateway introduces you to the right partner from a pool of pre-qualified supplier-firms, made-up of leading accounting, legal and consulting agencies in Cyprus.
The Investment-Gateway.eu platform is a completely free service, together with offering added-value content in general information, news updates, documents and analytics on the local Cypriot, European and global economy to help with investment strategies to the EU, Europe, Russia & CIS, Middle East & Africa, as well as around the world.Investment Gateway Contact information:
|Investment Gateway Media||Investment Gateway Agents|
|communications 'at' investment-gateway.eu||info 'at' investment-gateway.eu|
Investment-Gateway is an eco-friendly professional services platform, taking action on global climate change by offsetting carbon emissions on behalf of all clients. Learn More