Legal due diligence

Legal due diligence is the systematic review of a company's legal situation, carried out before a significant transaction such as an investment, an acquisition (M&A), a merger or a financing round. Its purpose is to identify risks, contingencies and hidden liabilities that could affect the value or viability of the deal. Legal due diligence typically reviews the company's incorporation and bylaws, share ownership, key contracts, labor and social security status, ongoing litigation, regulatory compliance, intellectual property, and permits and authorizations. The findings are documented in a report that allows the buyer or investor to make informed decisions, negotiate the price or require warranties. Under the Outside General Counsel model, the firm coordinates and executes due diligence across all relevant areas under a single, unified view.