If you are an investor looking at a potential acquisition target in Russia or planning to invest in a joint venture with a Russian legal entity, you might need the help of reliable lawyers Russia to ensure that you are risk free and left with no financial liabilities at the end of the transaction. Here are a few tips that you must remember during a due diligence.
Channelize the human capital
Several business studies have reported that failing to manage the human capital of an organisation is the most common reason for merger and acquisition failures. During the diligence process, the lawyers Russia must take the effort to clearly communicate all changes, offer job and other benefits assurance and thus make certain that the talent pool is retained.
Dig deeper into the available information sources and IT systems
Information and technology form the backbone of any business. Therefore the team hired to perform the due diligence must ensure that the buyer’s existing technology infrastructure can be integrated seamlessly into that of the seller. There must be no loss of vital data and the cost of the process must be kept at the minimum level. This cost must be considered while obtaining the financing for the purchase.
Unravel all liabilities
Liabilities in any form can hamper the profitability of the transaction considerably. Hidden liabilities come in the form of environmental issues, legal claims from employees and so on. The due diligence team must work with the management as well as the employees to unravel any form of hidden liability.
Look beyond the balance sheet
Financial statements are a great way to have a complete idea about the assets of the seller. However to know the complete status of the assets along with their quality, the buyer must invest sufficient time and effort to analyse the degree of depreciation of the buildings, equipment, plants and the inventory. A experienced due diligence team will think beyond analysing financial statements and will actually guide you through to obtain first-hand information about the firm’s assets.
Analyse the supply-side and demand –side relationships
In any type of business and especially in the industrial sector, the relationship that a firm holds with its supply chain partners vastly influences its success rate. Strong supplier associations and the good will to attract customers are important strengths of a company. Any discrepancy in these factors must be analysed during the due diligence. No matter what ever type of firm you pick up from the company register Russia, for successful business collaboration either in the form of mergers and acquisitions or joint ventures and franchisees, a well-experienced due diligence team must assist you to minimize all types of risks and keep you away from any potential litigation issues.
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