VDR as the best tool in the Merger & Acquisition market

Conducting transactions in today’s reality is much easier and less time-consuming than before. The same applies to mergers and acquisitions. In the past, when all these transactions were on paper, many were horrified at the prospect of them. Not surprising! This requires a huge amount of paper documents, people involved in transactions, as well as huge premises.

Virtual data rooms allow you to conduct transactions without all the paperwork – conveniently, comfortably, and without leaving your home.

How are transactions made using VDRs?

Like ordinary M&A transactions, virtual transactions are carried out in three stages:

  1. Preparation for the purchase and sale of the company. First, you need to create a virtual room. This responsibility falls on the shoulders of the seller. This is quite simple and the computer department of your enterprise can easily cope in just half an hour or an hour. Then all the documents necessary for the transactions are uploaded there. They must necessarily include the history of the enterprise, all previous transactions by this company, financial documentation.
  2. The due diligence stage. Before making a deal, the acquiring company must carefully check the documentation. For this, diverse specialists are invited to work together on documents in the data room. The seller company gives access to data to certain specialists while respecting the principles of hierarchy and access levels. Usually lawyers, financiers, economists work in a team.
  3. Integration stage. After the transaction is completed, it will take some time for the documents to pass from one company to another. At this stage, the data room can also be useful – it will become a kind of buffer for the transfer of documentation.

The data room, as you can see, helps to optimize the processes of information transfer and speed them up. You can read more about it here

Advantages of VDR technologies

Many entrepreneurs feel that a virtual data room is not much different from regular cloud storage. However, this is not quite true. VDR technology is much better suited for corporate processes than classic cloud storage. The best data room features are in the list below:

  • Impeccable security of your data. Conventional cloud storage, of course, has certain protection systems, but they are not as perfect as those of data rooms. Therefore, by uploading your corporate documents, you can be sure that everything will be safe and will not disappear anywhere. And most importantly, your documentation will not fall into third parties – all data is available only to those to whom you provide access to your data room.
  • Simplicity in work. It may seem like a data room is a complex technology, but it is quite intuitive. Its setting can be easily figured out, even without sufficiently deep knowledge in the field of computer technology. In the same way, everyone will simply use it: from managers to lawyers.
  • Full compliance with the law. With the help of the data room, it is much easier to control the legality of the ongoing manipulations – everything is completely transparent, you can see every change that every document has experienced. There are necessary templates that greatly simplify the process of conducting transactions.

And the main advantage is the opportunity to save money and resources for company employees. There is no need to call employees to offices, occupy premises, deal with a large amount of paper documentation. In a pandemic, this is especially true, the creators of virtual data rooms also note.