Due diligence for mergers and acquisitions require the seemingly contradictory skills of focusing deep understanding while casting a broad analytical net. Missed details and exposures can have dire consequences down the road. SBT can help. We review the scope of coverage attached to the target company including claims experience to help assess risk and exposure. But we don’t stop there. Take a look at the list below and see the value SBT can provide during your pre-acquisition due diligence process:
SBT will assess loss sensitive policies or high liability retentions/deductibles that may place you at risk. We will assess uninsured exposures. Further SBT will evaluate whether an economy of scales can be achieved between your existing program and the target company–the goal being a reduction in premium and continuity of coverage.
SBT will examine your purchase and sale agreements, not only for the current transaction, but for prior acquisitions and divestitures as well. Major customer and vendor contracts will also be examined.
SBT will help you catalog locations, construction, square footage, values for buildings, contents, EDP, accounts receivable, and the appropriate loss of income for the exposure. We’ll walk through all inspection reports and work to identify hidden expenses.
SBT will analyze claim history to quantify exposure for general liability, workers’ compensation, and automobile liability. We’ll also evaluate retrospective rating plans, identify the appropriateness of any collateral in place and discuss any special servicing requirements.
We’ll analyze worker’s comp issues at your target organization and apprise you of special issues arising from foreign employees, monopolistic states’ policies, payroll, premium, administration agreements, and the ramifications of combining the experience modifier.
We’ll analyze your targets projected and historical sales, understand their products and services, vendor liabilities, professional liabilities, sales of imported or third party products and identify any Employee Benefits Liability (EBLI)
We’ll unearth any history of hazardous materials use or wastes disposed of at or from facilities at your target entity and bring to light any previous environmental violations, litigation, settlements, environmental complaints, and public actions as well as complaints from tenants or workers regarding adverse health effects due to environmental conditions.
In addition to the areas listed above we will delve into these more specific areas that may cause concern in a potential merger or acquisition: