Make Cybersecurity an Essential Part of M&A Due Diligence

INSTITUTIONAL INVESTOR | June 2, 2016

2015 was certainly a bumper year for M&As.  It’s a sure bet that before any of the 2015 M&A deals went through, the buyers looked very carefully at their “target” companies. They will have gone through a comprehensive appraisal and due diligence process that lasted from a few months to a year.

Buyers and their agents (auditors, lawyers and bankers) will have had a pretty exhaustive evaluation checklist – review software licenses, audit financials, inspect buildings, count inventory, validate the value of intangible assets, look at intellectual property, and — the step that’s caused about half of my companies some heartburn — determine if all the shareholders can be contacted and notified. As an investor, I have pretty extensive experience in this process, having been involved in some 34 acquisitions; and one all too common oversight that I am resolute in ensuring makes it to the checklist is cyber security.