The primary factors to be considered while acquiring the shares in a legal entity/ company or while merging with another legal entity/company is the financial stability of such legal entity and the legal compliance or the potential liability such legal entity might be exposed to in due course.
We assist clients on the second leg of acquisition or merger whereby upon reviewing the fundamental documents like MOA and AOA and other transactional documents like any agreements entered into by the company we assess whether the said legal entity is in compliance with the law and also analyze if there is any likelihood of any potential claims that may arise from any transactional agreements in the future. It is understood that per se the legal due diligence process often is a boon to clients to make a final decision with regard to such mergers and acquisition.
The said process is also availed by clients in the event of lending lump sum amounts as loan to a company or to any third party so as to understand the viability of the business and to analyze the risk involved in the event of default of repayment of loan amount advanced.