You may wish to acquire a business to tap into a particularly talented pool of people, to gain access to markets that may take your business too long to access, or to acquire strategically important product lines that allow your business smooth out its product life cycle portfolio.
There will normally need to be a seriously compelling strategic reason to acquire a business. Should you decide to acquire a business for whatever reason, it is imperative that you know what you are acquiring, good and bad.
Identifying a target business and negotiating the key heads of terms required in an acquisition process, is challenging. It is important then that one ensures that what they are being told is being sold - is what is being sold. This is where the term due diligence comes in. It is a discipline and clearly must be followed on any occasion that finds you purchasing a business – to provide you with sufficient assurance that you are not actually acquiring a problem.
Searing Point approaches due diligence assignments, careful not to impinge upon the goodwill that exists between the parties, but nevertheless with a degree of professional scepticism to ensure as much as possible, there are no “skeletons in the cupboard,” to ensure what should be there is there - this includes verifying assets the business report they have, and ensuring that all liabilities are fully disclosed.