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Additional Posts in M&A - Mergers and Acquisitions Professionals
Is CIBC capital markets a good investment bank?
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Operational Diligence is a subset of confirmatory diligence.
Confirmatory due diligence is the process conducted by the buyer within the last 60 days of the transaction cycle during which legal, financial and ‘operational’ due diligence is performed. Usually takes more time in M&A.
I do a lot more of these now after I've moved to industry. It's like an ODD in some ways but less "report-y" and canned. We're not always a part of the advisors DD process (we typically use B4) pre sign because we don't have the bandwidth, so confirmatory is for us to double click one level down from a functional area perspective using the DD report as an anchor point after we sign. Advisors also give their opinion on high level risk areas so we try to test those out as well. Our output of confirmatory is not an 80 slide report but rather for us to know enough about the company so we can rough sketch the integration program charter, confirm deal thesis/value drivers, high level operational milestones, big risk areas, almost like a mini sign to close plan leading up to Day 1 and calling out post Day 1 "big blocks"
If it is on a buy side, usually it means that we are just confirming and testing all of the hypotheses set out in the sell side report. Never heard this phrase used on the sell side.
I’ve never heard that term. It sounds like an umbrella term for DD? Might include standalone, operational, IT, CDD, etc.
Confirmatory for us is typically post NDA but Pre LOI. High level financials, metrics, discussions. Not the meat and potatoes of the deal.
My understanding is pre-LOI diligence is non-confirmatory and type of diligence conducted varies, but typically when business diligence and CDD are done.
Confirmatory is post-LOI and typically when ODD, IT DD, tax, legal, etc. is done. Think of confirmatory as they’ve already made the go/no-go decision and working on final bids
Whatever you think it is, that is correct!
To check the VDD basically, buy side stuff