Business Acquisition Review

The Challenge

Our client was days away from signing a binding acquisition agreement when their CFO flagged inconsistencies in the target's working-capital schedule. Initial review surfaced red flags across two more areas — the IP chain of title for the target's flagship product was incomplete, and there were unresolved employment claims that had not appeared in the data room. The deal team had momentum, the seller was pushing hard to close before quarter-end, and walking away would have cost the client a strategic foothold in a category they had been pursuing for two years.

Our Approach

We mobilised a 10-day intensive diligence sprint with parallel workstreams across finance, IP, employment and regulatory. Forensic accountants rebuilt the working-capital schedule from source ledgers, IP counsel traced ownership of every code module back to original contributor agreements, and employment counsel pulled depositions in two open claims the seller had failed to disclose. Three material issues were documented in writing within the sprint window. Armed with that evidence, we then reopened negotiation on price, restructured the indemnity package to specifically cover each surfaced risk, and converted a portion of the consideration into an earn-out tied to clean post-close audit milestones.

The Result

Acquisition closed on the original timeline at a 15% lower headline price, with a tailored indemnity and a multi-tranche earn-out that aligned the seller's incentives to a clean handover. Post-close integration encountered none of the issues we surfaced during diligence — every risk had been ring-fenced contractually before signing. The client retained its strategic foothold in the category and avoided what would otherwise have been an eight-figure write-down in year one.

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