Evaluating IT prior to an acquisition
We help you get the right deal
If you are a private equity or venture capital firm buying or investing in a company - understanding the target's technology can be of crucial importance. Perhaps you are an IT staff member who has been asked by your company to evaluate a potential acquisition?
Our team of experts with years of experience and established due diligence methods, quickly identify the key issues you need to be aware of before you acquire.
The challenge
A merger or acquisition is a very stressful time for all parties concerned. There are lots of different streams of activities that need to be done, normally in a very tight time frame particularly when there are competitive bids or market pressures.
Technology is one of the key risks. You don't want to be investing in systems that are unreliable, where you are dependent on people that might leave or where key individuals are not qualified to meet the business projections for growth.
In addition, a key driver for this work is the savings that can be achieved in the back office - in particular merger and integration of IT systems.
Whilst a focus on systems is particularly important in businesses where there is online transaction processing or higher volumes of transactions taking place, it is just as applicable to a traditional ‘bricks and mortar’ business as for a company whose IT is core to it performance as failures of systems and data can soon bring a company down to its knees.
How does the DrPete team help?
We first gain an understanding of your need as an investor. Whilst we have generic things that should be covered we first develop the scope around want your needs, hopes, ambitions and projections for the business are in the coming years.
We then set out to understand the investee target company’s business strategy and processes. This may include, but is not limited to:
- The computer hardware and software, business systems and networks
- IT personnel and reliance on key people or external suppliers
- IT governance and budgets
- IT management processes
- Interruptions or interference caused by inadequate security
- Legal and compliance issues.
The deliverable
The report we produce is usually presented in a debrief workshop meeting where we explain the results of our findings for your review and feedback. We discuss the issues identified, their relative importance and the options for resolving them.
How long does it take?
Our consultants have many years of experience of technology due diligence situations. One of the most pressing things we recognise is that time is of the essence especially when considering exclusivity periods that can be quite limited. Typically we initiate very quickly on these transactions and undertake the work in a few weeks from start to finish including (as required) a final review workshop.
Our consultants have supported transactions ranging from small trade sales of £2 million to FTSE IPO valued at £4 billion and have acted for angels, private equity and investment banks.
Do you work worldwide?
In today's environment we are well aware that transactions are often cross-border. Our team of consultants have worked around the world. Whilst most technology we encounter is based around English, we have worked in areas where there are barriers to the English language. We undertake this by using our consultants that speak that language or by seeking local help.
Role of cloud services in due diligence to reduce risk
With our specialist understanding of cloud-based services we also advise our investing clients on whether the transaction can be made smoother, more efficient and cost-effective by using cloud-based systems either during and immediately after the transaction or on an ongoing basis.