Index

accountants/accounting, 2^nd, 3^rd, 4^th

FDD reports on, 2^nd, 3^rd

and legal due diligence

acquisition planning, 2^nd

see also integration plans

acquisition agreement see sales and purchase agreement

actuaries

advertising, finding candidates through

advisers

advisory teams

briefing

checklist for appointing

communication on updates

and confidentiality agreements

day-to-day management of

and due diligence, 2^nd, 3^rd, 4^th, 5^th

and FDD investigations

fees

final reports

liability caps

preparations for working with

reports of specialist advisers

selecting, 2^nd

and stages of the acquisition process

terms of reference for

when to involve

aggression in negotiations

anger in negotiations

Anglo-Saxon countries

letters of intent in

assets

fixed

and target investigations

asset base, 2^nd

FDD assessment of, 2^nd, 3^rd

see also net assets

auctions, finding candidates through

auditors

and FDD investigations, 2^nd

balance sheet values

banks

and target investigations

bargaining power

BATNA (best alternative to negotiated agreement), 2^nd

bluff in negotiations, 2^nd, 3^rd

body language

and negotiations, 2^nd

bottlenecks in negotiations

breach of confidentiality agreements

budgeting

and integration planning

build-up strategy

business models/cultures

and commercial due diligence

and target evaluation

buyer selection

and target companies, 2^nd

cash

and sales and purchase agreements

and target companies

FDD investigations

cash flow

FDD reports on, 2^nd

see also discounted cash flow (DCF)

caveat emptor principle, 2^nd

CDD see commercial due diligence (CDD)

certificates of title

commercial activities

FDD reports on, 2^nd

commercial due diligence (CDD)

aims of

analysis phase, 2^nd

and financial due diligence, 2^nd, 3^rd

and internal/external organisations

market and customer insight, 2^nd

meet management phase, 2^nd

and problem solving

reporting phase, 2^nd

start-up phase

terms of reference

communication

and commercial due diligence

and integration planning, 2^nd, 3^rd

phases of, 2^nd

comparable transactions

as a valuation method, 2^nd

competitive strengths and weaknesses

and the search process

competitors

and commercial due diligence, 2^nd

and integration planning

confidentiality

and acquisitions agreements

and commercial due diligence, maintaining while gaining customer insight

confidentiality agreements, 2^nd, 3^rd

breach of

information covered by

persons signing

and target investigations

time limit on

confidentiality clauses

in acquisitions agreements

in letters of intent

confidentiality obligations

of target companies

consensus (buyer-seller)

consolidation strategy

constitutional documents

consultants

acquisition search, 2^nd, 3^rd

and commercial due diligence

and integration planning

role of business consultants

contingent fee arrangements

contingent liabilities

contracts

and legal due diligence, 2^nd

shares and the law of contract

control systems

FDD investigations into

sellers of target companies

cooperative negotiation

core businesses, 2^nd

corporate development, 2^nd

corporate financiers, 2^nd, 3^rd

and target investigations

when to involve

corporate investigators

costs

cost reductions

and integration planning

sellers of target companies

synergies

FDD reports on

transaction and reorganisation

critical success factors (CSFs)

and commercial due diligence, 2^nd, 3^rd

cross-border transactions, 2^nd

culture

and commercial due diligence, business models/cultures

cultural differences

and corporate development

in questioning

FDD reports on organisational culture

and integration planning

adjustment to fit the cultural gap, 2^nd

barriers to integration

customers

and acquisitions agreements, 2^nd

and commercial due diligence

customer insight

data requests

and corporate development

FDD reports on

and integration planning, 2^nd, 3^rd, 4^th

and target investigations

data analysis

and customer assessment, 2^nd

data requests

and commercial due diligence

data room visits

and legal due diligence

DCF see discounted cash flow (DCF)

deal breakers

deal management, 2^nd

deal points

and sales and purchase agreements

debts

and discounted cash flow valuations

and sales and purchase agreements

and target investigations

FDD investigations of

deception in negotiations

desk research

and commercial due diligence

disclosure letters, 2^nd, 3^rd, 4^th

discounted cash flow (DCF), 2^nd, 3^rd

adjustments

assumptions of

computer modelling

costs of debt

free cash flow

mathematics

terminal value

distribution channels

distributors

and commercial due diligence

dotcom investors, 2^nd

‘drive-by investing’

due diligence

and the acquisition search process

and acquisitions agreements, conditions to closing

advisers, 2^nd, 3^rd, 4^th, 5^th

five strands of

and integration planning, 2^nd, 3^rd

due diligence teams

and valuation

and letters of intent

and misrepresentation claims

specialists, 2^nd

and target evaluation

and target investigations, 2^nd, 3^rd, 4^th

business risks

and outside advisers

sensitivity to

teams

types of due diligence

vendor due diligence

see also commercial due diligence (CDD); financial due diligence (FDD); legal due diligence (LDD)

duplication and organisational structure

FDD reports on

earn-outs

and financial due diligence

preliminary agreements on

and sales and purchase agreements

earnings

FDD assessment of, 2^nd

as a method of valuation

EBITDA method of valuation, 2^nd

emotion in negotiations

employees

and acquisitions agreements

restrictive covenants in

FDD reports on, 2^nd

former employees and commercial due diligence, 2^nd

and integration planning, 2^nd, 3^rd, 4^th

acquired employees and day one

job losses

and legal due diligence

rates of pay

redundancies, 2^nd

staff turnover

and target investigations, 2^nd, 3^rd

environmental specialists

EPS (earnings per share), 2^nd

equity see shares (equity)

escrow accounts

European countries

letters of intent in

exclusivity, preliminary agreements on

existing markets, searching

experts in negotiations

failed acquisitions, 2^nd

and integration plans, 2^nd

FDD see financial due diligence (FDD)

fees

for advisers

contingent fee arrangements

FDD reports on management fees

introduction fees

provision for in letters of intent

success fees

financial control

and integration planning

financial due diligence (FDD)

and commercial due diligence (CDD), 2^nd, 3^rd

investigations

checklist for

contents of reports

key issues to cover

sources of information

financial projections

FDD review of, 2^nd

finding candidates

acquisition criteria

acquisition databases

advisers for

drawing up a shortlist

making an approach

mapping the market

running an acquisition search

screening potential targets

strategy

fixed assets

focus groups, 2^nd

forecasts

and commercial due diligence, 2^nd

and financial due diligence, 2^nd

sellers of target companies

fragmented markets

consolidating, 2^nd

screening potential targets

gearing

good cop/bad cop

gross margins

FDD reports on

growth

and commercial due diligence

comparisons of growth strategies

short-listing targets based on

guarantee of the guarantee

guarantees, release of

heads of terms see letters of intent

history of target companies

FDD reports on, 2^nd

IM (information memorandum)

indemnities

in acquisition agreements, 2^nd, 3^rd

alternatives to

indemnification against liabilities

and legal due diligence

preliminary agreements on

industry capacity

rationalising, 2^nd

industry observers

and commercial due diligence, 2^nd

information memorandum (IM)

information systems

FDD reports on

information technology

impact of, 2^nd

and integration planning

and legal due diligence

insider dealing

integration management, 2^nd, 3^rd

co-ordination of the project plan

and communication

and the due diligence team

integration teams

reporting systems

role of

skills and attributes of

integration plans

acquisition guidelines

advance development of

advisers for, 2^nd

barriers to

adjustment to fit the cultural gap

and customers, 2^nd, 3^rd, 4^th

early planning

reasons for

and investment appraisal

minimising uncertainty

moving quickly once the deal is done

phases of

day one

month one

one hundred days

week one

year one

post-acquisition review

soft issues in

and target investigations

intellectual property

and legal due diligence, 2^nd

preliminary agreements on

specialists

internet surveys

and customer assessment, 2^nd, 3^rd

interviews

and commercial due diligence

customer insight, 2^nd, 3^rd

market participants, 2^nd

and financial due diligence

finding acquisition candidates

selecting advisers

introducers

investigating the target see target investigations

investment levels

FDD reports on

issue analysis

key individuals

and target evaluation

key performance indicators (KPIs)

key purchase criteria (KPC)

and critical success factors, 2^nd

and customer segmentation

key talent

and integration planning

language

and negotiation

last resort, acquisition as

lawyers, 2^nd, 3^rd, 4^th, 5^th

LDD see legal due diligence (LDD)

leadership

and integration management

legal constraints

and integration planning

legal due diligence (LDD)

checklist for

defining

and organisational structure

process of

reasons for

legal framework

legal loose ends

and target investigations, 2^nd

letters

approaching acquisition candidates

disclosure letters, 2^nd, 3^rd, 4^th

engaging advisers

‘hold harmless’

letters of intent

advantages of

binding provisions, 2^nd, 3^rd

defensive clauses in

disadvantages of

enforceability of

give-and-take issues in

‘no-solicitation’ provisions

provision for expenses

topics covered by

liabilities

contingent

FDD assessment of, 2^nd, 3^rd

pension funds

indemnification against

liability caps

and sales and purchase agreements

lies and negotiations

line managers

and targets

and warranties

litigation

FDD reports on potential

loose ends

and target investigations, 2^nd

management

and commercial due diligence

data requests

meet management phase, 2^nd

FDD investigation of, 2^nd, 3^rd

changes in

reports on management fees

and integration planning, 2^nd, 3^rd

line managers, 2^nd

management teams and advisers

and target investigations, 2^nd

see also integration management

marketing

and integration planning

markets

and acquisitions target evaluation

and commercial due diligence

data requests on

market analysis

market and customer insight phase, 2^nd

and financial due diligence

market capitalisation and P/E ratio

market drivers and commercial due diligence

market mapping

market segmentation, 2^nd, 3^rd

short-listing targets by market position

misrepresentation

and sales and purchase agreements

‘missing link’ strategy

misunderstandings, feigned

named individuals

and confidentiality agreements

negotiations

advisers, 2^nd

aspirations, 2^nd

basics of

and body language, 2^nd

and deal management

dealing with pressure devices

dealing with tactical ploys

green light in

keeping control in

last-minute changes in

and power, 2^nd

preparing for

BATNA, 2^nd

checklist

interests, 2^nd

procedure

questions and answers

recognising and returning signals

rules of arguing

and sales and purchase agreements

silence in

skills, 2^nd

splitting the difference

starting discussions

threats in

trading concessions, 2^nd

uncorking bottlenecks

using intuition and logic in

win-lose tactics in

win-win, 2^nd, 3^rd

see also preliminary negotiations

net assets

backing, 2^nd

FDD reports on

new entrants

and commercial due diligence, 2^nd

new industry creation, 2^nd

new markets/products, 2^nd

new product development

niche businesses

commercial due diligence on, 2^nd

non-disclosure obligations

and confidentiality agreements

Office of Fair Trading

operating leases

operational barriers to integration, 2^nd

operational fit

and acquisition candidates, 2^nd

operational management

opportunistic acquisitions

option limitations in negotiations

organisation structure

FDD reports on, 2^nd

organisational culture see culture

ownership

and legal due diligence

P/E (price/earnings) ratio, 2^nd

parallel negotiations

pension funds

and discounted cash flow valuations

FDD reports on

and legal due diligence

transfer of

physical separation

and integration planning

post-acquisition review

power

and negotiations, 2^nd

preliminary negotiations

advisers for, 2^nd

confidentiality agreements, 2^nd, 3^rd

cross-border issues

letters of intent

pressure devices in negotiations

prices

preliminary agreements on, 2^nd

right price and deal management

private equity transactions, 2^nd, 3^rd

profit ratios

and valuation, 2^nd

properties

and legal due diligence

public relations constraints

and integration planning

public vs private P/E ratios

purchase agreements

advisers for

quality control

FDD reports on

questionnaires

and legal due diligence

redundancies

FDD reports on

regulators

and commercial due diligence, 2^nd

representations

and sales and purchase agreements

research consultants

research and development (R&D)

return on investment (ROI), 2^nd

risk

business risks, and sellers of target companies, 2^nd

and commercial due diligence, 2^nd

and escrow solutions

ROI (return on investment), 2^nd

roll-out strategy

sales

FDD reports on

growth synergies

and integration planning

sales and purchase agreements

boilerplate section

commencement

conditions to closing

cross-border issues

deal points

definitions section

entire agreement clauses

indemnification

recitals

restrictive covenants

retentions in

shares and the law of contract

see also indemnities; warranties

secret research and development (R&D)

sector-specific valuation benchmarks, 2^nd

shareholders

and acquisition targets, 2^nd

FDD reports on changes in

and legal due diligence

shares (equity)

and discounted cash flow valuations

and sales and purchase agreements, 2^nd

share prices and P/E ratios

shopping lists

and FDD investigations

site visits

and legal due diligence

skills sets

as barriers to integration

small transactions

specifiers

and commercial due diligence, 2^nd

staff see employees

stakeholders

and integration planning, 2nd, 3^rd

stalemates, fake

‘stand-alone’ transactions

standstill agreements, 2^nd

strategic fit

and acquisition targets

strategic growth routes

strategic planning, 2^nd

strategic reasons for acquisition

strategy

and the acquisition search process

success

fees

planning for

suppliers

and commercial due diligence

FDD reports on

and integration planning, 2^nd, 3^rd

surveyors

sustainable earnings, estimating

sweetheart deals, 2^nd

symbolism

and integration planning

synergies

and acquisition candidates

acquisition synergies and financial due diligence

and acquisition target evaluation

calculating

and integration planning, 2^nd

valuation and synergy benefits

target evaluation, 2^nd

target investigations

and the acquisition process

advisers for, 2^nd

and due diligence, 2^nd, 3^rd, 4^th, 5^th

commercial

financial, 2^nd

sensitivity to

teams

preparations of the target company

asset base, 2^nd

business risks, 2^nd

buyer selection, 2^nd

control systems, 2^nd

forecasts, 2^nd

loose ends, 2^nd

management and staff, 2^nd

trading record, 2^nd

preparing for obstacles

and project management

see also commercial due diligence (CDD); financial due diligence (FDD); legal due diligence (LDD)

taxation

and discounted cash flow valuations

and indemnities

and legal due diligence

and target investigations, 2^nd

FDD reports on, 2^nd

teams

advisory teams

integration teams

and bid teams

target investigations and due diligence

technology

and integration planning

see also information technology

telephone calls/interviews, 2^nd

termination notices

trade journalist/associations

and commercial due diligence

trade unions, 2^nd

trading concessions, 2^nd

trading record, 2^nd

FDD reports on

transfer pricing

FDD reports on

transformative deals

triangulation on value

trump cards in negotiations

ultimatums

uncertainty

and commercial due diligence

and integration planning, 2^nd

uplift

and commercial due diligence

valuation

advisers for

calculating synergies

the ‘going rate’, 2^nd

integration and due diligence

and integration planning

intrinsic value, 2^nd

and legal due diligence

and modelling

myths of

summary of the valuation process

techniques

choosing the valuation method

comparable transactions, 2^nd

discounted cash flow (DCF), 2^nd, 3^rd, 4^th

impact on earnings per share, 2^nd

net asset backing, 2^nd

P/E (price/earnings) ratio, 2^nd

return on investment (ROI), 2^nd

sector-specific valuation benchmarks, 2^nd

for special cases

transaction and reorganisation costs

vendor due diligence

WACC (weighted cost of capital), 2^nd

warranties

in acquisitions agreements, 2^nd, 3^rd

conditions of closing

establishing breach and making a claim

post-deal

restrictions on making claims

and the seller’s financial position

size of damages

defining

and legal due diligence

preliminary agreements on

see also indemnities

win-lose tactics

win-win negotiations, 2^nd, 3^rd

written questionnaires

and legal due diligence