MFA provides due diligence services to organizations that are considering mergers and acquisitions, direct investments, debt financing, strategic partnerships and joint ventures. Our seasoned professionals incorporate a unique blend of investigative, analytic and financial skills into their approach with a focus on the strategic value of the target business that is the subject of the transaction. We focus on facts, trends and behaviors that are critical to the success of your deal, as well as risk factors that may preclude its success. You can count on MFA to dig deep and provide the added insight into the future value of your target business across a wide variety of factors.
Financial due diligence is a key aspect in the overall evaluation and assessment of a target business. It enables companies to obtain a more complete picture of the financial realities of a target business by reviewing the quality of earnings and assets, distilling risks and liabilities, conducting integration assessments and assessing the purchase price.
At MFA, we assist strategic and financial buyers in verifying the financial results on which an offer is based. In doing so, we help buyers attain a level of confidence in their understanding of the underlying performance of the target organization. Our comprehensive financial due diligence services focus on analyzing and reporting on quality of earnings; identifying overvalued, undervalued and unrecorded assets and liabilities; reviewing forecasts and budgets; and assessing prospective future operating results and cash flows. As part of the process, we also evaluate and advise on complex tax issues, deal structuring, reporting requirements and general economic conditions of the particular industry. Furthermore, to ensure we deliver a well-rounded and comprehensive view of the target business, we identify and report on any risks related to corporate governance, financial reporting and the accounting environment in general.
Each transaction brings its own set of potential exposures to buyers and sellers. MFA’s tax due diligence professionals draw upon their extensive transaction experience to help clients to understand the tax implications of a proposed deal and determine the optimal tax structure for creating maximum deal value. We analyze historical tax returns and financial statements to identify tax risks and tax opportunities associated with a contemplated transaction. We also identify relevant sales, use and miscellaneous tax issues that may result from the transaction. In addition, we work closely with our clients and their legal advisors to structure a deal in the most tax efficient manner, adding significant tax savings and real value to the return on your investment.
Perhaps one of the most important, yet often overlooked parts of due diligence for mergers or acquisitions is assessing the IT component of the target company. At MFA, we provide a comprehensive assessment of your target company’s current technical environment, including the identification of issues and financial implications. We also take it a step further by identifying opportunities where you can leverage the target’s technology, and by providing recommended transition initiatives to ensure a successful merger of technologies.
Regulations issued by the U.S. Department of Labor have redefined fiduciary responsibility in terms of employee retirement plans, and increased the personal liability for business owners. With this in mind, many buyers are now retooling their due diligence approach to incorporate a comprehensive review of their target business’ retirement plan offerings. While buyers may not be liable for prior claims or penalties incurred by the company they are buying, post-transaction they will ultimately be liable for any breaches that continue to occur due to unresolved problems. Our knowledgeable, independent advisors have consulted on numerous merger and acquisition deals, and their expertise in fiduciary responsibility can ensure that any potential issues are brought to light before your deal happens.
To learn more, download our Due Diligence brochure.