Due Diligence in Private Equity
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What unique challenges do private equity firms face during due diligence? How do private equity firms address them?
Hi Julita.
PE firms often lack the robust financial reporting seen in public firms, making it harder to verify financial performance. Often times PE firms are dependent on outdated systems or processes that may not scale with growth.PE is strongly result-oriented and usually works with its own money. This means thorough DD is critical! PE has to address all the aspects of the target’s business and ensure that the business plan and projections are as accurate as possible.
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