Ideally, you`ve collected and reviewed most of the information the buyer wants while preparing your business for sale. The vast majority of them are in paper form. The buyer wishes to see copies of all leases, contracts and loan agreements, as well as important financial documents and bank statements. The best way for a practitioner to ensure that they receive all the information required/desired by a client through the due diligence process is to use a client questionnaire. This has the advantage of clarifying the objectives of the transaction, as well as the amount of due diligence required, the period within which due diligence must be carried out and who is responsible for due diligence. Performing due diligence is an important part of the buying process and certainly something that every buyer of commercial real estate should do before closing. Due diligence allows a buyer to obtain additional – and often very important – information about the property in question and can indicate areas that need to be renovated before being completed. In rare cases, due diligence can detect an error that cannot be easily corrected and may be significant enough to end the transaction. The consultant`s ability to perform intelligent and cost-effective due diligence on behalf of a client is essential and has the potential to create excessive value for the client. The ability of a demanding consultant to identify problems and draw the client`s attention to this point is an invaluable quality that external due diligence consultants may not have. Therefore, the role of a practitioner in the due diligence process is extremely important and should not be overlooked by a client. The declaration of intent phase can be ignored if you know your buyer well (e.g. B if the buyer is your child or an important collaborator) or if the agreement is very small and it seems that you can directly continue the negotiation of the sales contract.
Even if you and your buyer decide to waive the formal letter, we still recommend that the buyer sign a confidentiality agreement before proceeding with thorough due diligence. . . .