A comprehensive guide to M&A due diligence

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Operational due diligence delves into the day-to-day workings of the target company. This process provides a detailed view of the company's operational structure, including its supply chain, production processes, and customer base. The aim is to assess the efficiency and sustainability of the company’s operations. For a merger or acquisition to succeed, it’s essential that the operations of both companies can seamlessly intertwine like the threads of an intricate tapestry. Any inefficiencies or bottlenecks identified during this process must be addressed to ensure smooth post-merger integration.Tax due diligence ensures that the target company has complied with all tax laws and has no outstanding tax liabilities. The acquirer must review past tax returns, assess the company’s tax structure, and identify any potential tax risks that may arise from the transaction. Failure to address tax issues could have serious consequences, turning what seemed like a verdant deal into a crucible of financial challenges. By ensuring that the target company’s tax situation is sound, the acquirer can avoid future tax disputes and ensure the transaction proceeds smoothly.
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