Charl’s top tips for due diligence in acquisitions

“Guys put their best foot forward and use their best-case scenarios. You must be careful of that and be sure to look through historical information and make your own assumptions. Don’t rely only on the assumptions of the counterparty,” says Charl.

He provides the following five tips:

1. Understand the asset that you are buying: what are the reserves and resources? 2. Conduct adequate legal due diligence. 3. Conduct thorough financial due diligence and understand the company’s operations fundamentals. Don’t neglect the tax aspect and how this is structured. 4. Pay attention to the human capital process and the people involved and ensure that you can accommodate the Ts and Cs of their employment contracts into yours. 5. If relevant, conduct environmental due diligence.