Due diligence of Merger/Amalgamation :
Due diligence in merger becomes critical when the merging companies are separate group companies. Merger of the companies may be adopted in lieu of direct acquisition of shares of the target company. As a subsequent to merger there may be some shareholders who are exiting or there may be change in management control and BODs of the target company. Therefore, the diligence would have to be conducted with a view to assess the likely impact on business operations as a result of the exit of target shareholders (impact on customers, suppliers, employees etc.). Due diligence should also not ignore the possibilities of the past liabilities coming to the entering/new management and owners. The due diligence exercise should cover all the aspects including legal and regulatory.