Legal due diligence solicitors

In any potential acquisition of a business or a company, or even a part investment in one, due diligence is an investigation or audit of the target company. JMW's experienced corporate solicitors have a wealth of experience in conducting due diligence checks prior to your acquisition of - or investment in - a business. We can also support you when buying commercial or residential property, or when entering a joint venture or other partnership, to allow you to make decisions with the benefit of clear, accurate information.

Thorough due diligence is a requirement for high-value and high-risk transactions, and is sometimes necessary to comply with legal requirements, but it can be a vital way to protect any investment and is an opportunity to verify the material facts regarding the target company.

Drawing on a thorough understanding of complex business transactions, we prepare reports and other documents that will give you confidence in your investment, or highlight risk areas that might require further attention. We also draw on a host of reliable sources and a specific understanding of the potential for risk based on your industry or sector. This cross-sector experience is important, as regulations and risk factors differ, and JMW has a strong track record across many industries within the UK.

Our thorough due diligence process provides any acquirer or investor in an organisation with confirmation of material facts regarding the target business, partnership, or joint venture, and we can support you to address or mitigate any areas of concern we have identified before the deal moves forward.

To learn more about our process or how we can help you, contact us today. Call JMW on 0345 872 6666 or use our online enquiry form to request a call back at your convenience.

How JMW can help

JMW’s corporate solicitors are experts in reporting on and managing the legal due diligence process and dealing with the project management of complex acquisition and investment scenarios. We go beyond basic source of funds checks and identity verification to provide insights into any potential buyer or acquisition that can protect you and, where necessary, comply with vital anti-money laundering obligations or other legal responsibilities.

Many members of our team have practical business experience that they bring to their roles having been part of a management group that built and sold its own businesses previously. This gives our corporate lawyers a deeper insight into your needs from the process. We are regulated by the Solicitors Regulation Authority and have a strong track record of success in this area, with 30% of our business coming from long-standing clients, and 70% coming from new clients and recommendations.

Where more than one team of advisors are acting for the investor regarding different aspects of the due diligence (for example, one team working on financial due diligence and another on legal due diligence), the process needs to be carefully project managed. JMW can provide supervision and coordinate the process carefully to deliver the best results - for example, by ensuring that questions raised in respect of the target by one advisor are not replicated by another.

As a full service law firm, JMW is further able to draw upon the combined skills of partners in other fields such as employment law and commercial property, in order to provide a potential acquirer or investor with practical, added-value commercial advice. Our thorough approach and longstanding expertise allow us to deliver guidance within any agreed timetables, to keep the investment process on track for you.

Meet our team

JMW’s experienced corporate team has a wealth of experience in providing due diligence services for even the most complex transactions, and can enable you to make the most of your investment.

What is the due diligence process?

The due diligence process involves an investor instructing experts in specific areas to perform relevant checks related to a target business.

At the outset, the acquirer or investor is typically asked to sign a non-disclosure agreement or confidentiality agreement related to the target business and the information they will learn. Then, they can instruct and brief advisors on the nature of the deal and the target business' characteristics. You may wish to instruct advisors across the following areas:

Once they have a good understanding of the potential investment, the advisors can prepare a questionnaire for the target to complete, requesting that responses are returned by a specified date in accordance with the agreed timetable for the transaction. The buyer will rely on the accuracy and the validity of the responses when making a decision to invest, and the information received will help structure the nature and extent of the warranties and indemnities in the share purchase agreement.

Alternatively, the seller may create a “data room” either in person or virtually, whereby information on the target company is collated by the seller to enable potential purchasers to formalise the terms of an offer. Your solicitor can review these documents and advise you on any areas of concern.

In many acquisitions or investments the time pressures are often acute. The earlier the target can prepare documentation and responses in advance of receiving the due diligence questionnaire, the better. Our team will work quickly to provide the insights you need and prepare a report within the agreed timetable, to keep your transaction on track.

While an acquirer or investor can carry out the due diligence themselves if they have the technical capacity to do so, it is always best to work with an experienced solicitor. The scope of the due diligence task often covers all aspects of the target business, and it may be necessary to work with multiple teams to cover all of the relevant areas.

What documents and evidence should the seller supply?

As part of legal due diligence, the seller will usually be asked to provide documents and information covering the ownership, operation, assets and liabilities of the target business. These are commonly uploaded to a virtual data room for the buyer's solicitors to review. Typically, a target would be expected to supply copies of the following key documents:

• Memoranda and Articles of Association;
• Statutory books including minutes of board meetings, resolutions and shareholders’ meetings;
• Recent financial statements and taxation returns;
• Business plans;
• Employment contracts;
• Material sales contracts, supplier contracts and distribution agreements;
• Licensing agreements;
• Intellectual property matters such as patents and trade-marks;
• Property lease agreements;
• Pension scheme details and actuarial valuation reports;
• Insurance schedules;
• Environmental reports; and
• Details of any litigious or contentious matters.

Companies are required to maintain various corporate records, including records of members, directors' service contracts and certain resolutions and meeting minutes, and your solicitor will check against the information supplied during the transaction.

Where a problem is identified, we can then advise you on its significance and how it should be addressed. Depending on the issue, this might mean requesting additional evidence, requiring the seller to resolve the matter before completion, obtaining a specific warranty or indemnity, renegotiating the terms of the transaction or, in a sufficiently serious case, advising the buyer or investor to reconsider proceeding.