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Due Diligence
Whether you are divesting, acquiring, carving out, merging, integrating or doing follow-on acquisitions, there are immense costs and resources on the line, and due diligence is critical to your success. The FTI Consulting comprehensive 360-degree approach provides buyers and sellers with a full view of the financial landscape, including the commercial, operational, IT and human capital aspects of a business. Our deep bench of senior-level practitioners and experts understands the challenges, opportunities and competitive environments that underpin a deal. Leveraging decades of transaction experience, we bring on-point expertise and a team sized and matched to your specific needs.
How We Help
Engaging us to do the prework gives you an advantage — we can start integration work on Day 1. If the transaction is already underway or completed, we perform the post-close net working capital (“NWC”) analysis, serve in interim management roles, create strategic communications (including announcements to all stakeholders) and advise on HR policies, compensation and labor requirements.
Financial Due Diligence
Whether you’re on the buy- or sell-side of a transaction, our financial due diligence services include quality...
Whether you’re on the buy- or sell-side of a transaction, our financial due diligence services include quality of earnings assessment, determination of working capital requirements, net asset analysis, sales and margin analysis, short-term forecast analysis, synergy analysis and carve-out considerations. Clients rely on our deep functional expertise to ensure they get approval to move forward with a deal or determine that the transaction risk is too great.
- Buy-side financial diligence: Our buy-side clients rely on our capabilities across the entire life cycle of a merger, acquisition or other transaction. We help buyers assess historical performance of the organizations to be acquired, assess projected performance, review working capital trends, assess balance sheet exposure, provide insight into financial and business risks associated with the proposed transaction, identify integration challenges and deliver input to negotiate the purchase.
- Sell-side financial diligence: On the sell-side of a business sale, divestiture or carve-out, our clients rely on us to help them anticipate all potential issues and questions that might be raised by buyers and their advisors. As we do on the buy-side, we help sellers assess historical performance and projected performance, review working capital trends, assess balance sheet exposure, identify separation challenges and assist with sale negotiations.
Commercial Diligence
Clients rely on our commercial due diligence experts to help them assess, identify and define opportunities...
Clients rely on our commercial due diligence experts to help them assess, identify and define opportunities to capture revenue, new customers and new businesses. We provide market and company assessments, including customer interviews and assessments; market size evaluations; market share growth assessment and strategy; demand modeling; M&A; competitor assessment and assessment of KPIs; value proposition and brand perception assessment; and strategic partnership evaluations.
Operational Diligence
For transactions to be successful — whether you are on the buy- or sell-side — it’s imperative to know...
For transactions to be successful — whether you are on the buy- or sell-side — it’s imperative to know if the company’s operations are appropriately structured to deliver on its business plan. Our operational due diligence (“ODD”) practitioners are well-versed in qualitative and quantitative assessments of operational requirements, risks, opportunities and red flags.
We help clients understand and preempt potential operational issues that could arise from transactions, such as:
- Deal value estimates not being achieved
- Costs to achieve, or capital and resource investment required, being significantly higher than expected
- Anticipated synergy targets missed, or revenue and cost levers that need to be accelerated.
- Missing key transition service agreements (“TSA”) and purchase agreement (“PA”) requirements, and needing to renegotiate
- Determining appropriate valuation for the target
HR, Compensation & Benefits Diligence
HR, compensation and benefits due diligence includes analysis of health and welfare plans, pensions, compensation...
HR, compensation and benefits due diligence includes analysis of health and welfare plans, pensions, compensation and equity plans, employment agreements (e.g., change in control, retention, etc.) and other core responsibilities of HR organizations. We focus on the financial and operational aspects of HR, compensation and benefits in M&A.
We help clients answer questions such as:
- What existing people issues should be known before you purchase a business?
- What existing financial exposures within the compensation and benefit (“C&B”) programs should be factored into your bid?
- How much will it cost to run the HR function effectively on a standalone basis?
- How do the target’s C&B plans compare to market and, upon alignment to your programs, will it be a cost increase or decrease?
- What savings levers are available within the HR function and benefits that you may be able to pull post-close?
IT Diligence
When acquiring or selling a company, you need to know if the IT infrastructure can deliver on the company’s...
When acquiring or selling a company, you need to know if the IT infrastructure can deliver on the company’s business plan. We’re experienced in performing comprehensive technology and cybersecurity assessments to evaluate the overall IT infrastructure and application landscape, in addition to cybersecurity risks or opportunities. Clients involved in transactions rely on us to identify and report current state IT strengths, weaknesses and threats, as well as future state opportunities and requirements, to reduce IT risks and costs, improve and modernize capability and service delivery and add enterprise value.
When you are looking to complete a transaction, we help you assess:
- IT organization gaps, opportunities and governance
- IT infrastructure scalability, reliability, monitoring, licensing, investment opportunities and outsourcing
- IT spend, including performing industry benchmarking and identifying opportunities for vendor rationalization
- Security and privacy, including cybersecurity, incident management, payment card industry (“PCI”), Health Insurance Portability and Accountability Act (“HIPPA”), General Data Protection Regulation (“GPDR”), wireless and proactive
- Applications, including quote-to-cash, enterprise resource planning (“ERP”), commercial off-the-shelf software (“COTS”), bespoke, modernization and continuous integration and continuous delivery (“CI/CD”)
- Strategy on how to move forward with merger integration, carve-out, modernization and transformation