As a part of its Transaction Management Services, Constellation Blu has emerged as a credible, differentiated due diligence partner. It has successfully completed over 150 due diligence assignments. A due diligence is a deep dive into review of financial, secretarial, legal and commercial aspects of a company, on behalf of a potential investor. At Constellation Blu we have adopted a solution centric approach for our due diligence assignments which not only detects gaps but also helps in rectifying these as far as legally practicable.

Financial Due Diligence

This helps understand the financial health of a business and would enable validation of facts and figures as presented by Companies to prospective investors in course of the investment process. Financial DD Services includes;

  • Review of Financial Statements and Cashflow
  • Analysis of metrics and trends, product mix and its impact on business
  • Review of various Tax and Employee Law related compliances
  • Identifying the Conditions Precedents (“CP”) and Conditions Subsequent (“CS”)

Secretarial / Compliance Due Diligence

There are multiple laws and regulations that would apply to different kind of business and entities. A Secretarial / Compliance due diligence involves checking of applicability of various laws and regulations and adherence to these. There are certain laws that apply to all Companies like Company law and labour laws whereas as some are sector specific such as FDI in retail, insurance businesses etc. In a due diligence each of these would be reviewed in detail. Secretarial DD services includes;

  • Overview of Company charter documents and other regulatory filings
  • Review of Minutes of the Meeting, Share allotment filings
  • Understanding of ESOP Scheme, Grant Documents and Cap Table
  • Overview of vendor contracts, partnership agreements and key-employment contracts

Commercial Due Diligence

Along with a standard diligence scope, Constellation Blu believe that it would be of more relevance if our due diligence included in depth review and reporting of key areas of the business, i.e. conduct basic reference checks, test the product wherever possible, check for customer feedback and vendor feedback, going through lifecycles of a typical sale / service transaction that a company would have etc. It involves;

  • Review of business metrics and highlighting the trends
  • Validation of customer and supplier feedback
  • Review of forecasts and validating the forecast’s assumptions