IT is often the largest capital and operational expenditure item on the books meaning its value can be a game changer.

  • Buyers need confidence that the IT assets supporting the business are up to the task.
  • Buyers need a clear view of any IT investment required to maintain the EBIT of the target business and include these costs in their calculations and negotiations.
  • Sellers should Identify and deal with IT issues that could affect a transaction to secure the best possible sale price.
  • Sellers and buyers both need to minimise the impact of the sale and the transition process on business operations.

What is Due Diligence?

Due diligence is an investigation or audit of a potential investment or product to confirm all facts, such as reviewing all financial records, plus anything else deemed material. It refers to the care a reasonable person should take before entering into an agreement or a financial transaction with another party. Due diligence can also refer to the investigation a seller does of a buyer; items that may be considered are whether the buyer has adequate resources to complete the purchase, as well as other elements that would affect the acquired entity or the seller after the sale has been completed.

In the investment world, due diligence is performed by companies seeking to make acquisitions, by equity research analysts, by fund managers, broker-dealers, and of course by investors. For individual investors, doing due diligence on a security is voluntary, but recommended. Broker-dealers, however, are legally obligated to conduct due diligence on a security before selling it. This prevents them from being held liable for non-disclosure of pertinent information.

Key benefits:

Business essence is data, systems, processes. Due diligence of IT systems has become an important part in business transactions and the purpose of it is to:

  • Identify potential synergies (optimization, cost reduction, labour reduction) and risks associated with IT changes.
  • Assess compatibility of the existing software agreements and license types. Snapshot of all Hardware and Software.
  • Recommendations on mitigation of commercial risks pre- and post- closing, software license and agreement migration scenarios, license procurement improvements, software asset and cost management system implementation plan.

What is the difference between SAM and Due Diligence service?

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