Supply Chain Information Needed for M&A Due Diligence

A buyer will need information about the company’s supply chain in order to conduct her M&A due diligence. And a seller needs to be prepared to provide that information (along with information about every aspect of the business) immediately after signing an M&A letter of intent (LOI).

Purchasing and suppliers

  • Listing of major suppliers and dollar volume of purchases from each for each of the last three fiscal years. (A major supplier means the top 30 suppliers [by purchase volume].)

  • A separate list of any supplier to the company where practical alternative sources of supply are not available.

  • Schedule of open purchase orders, to include item number, description, quantity, price, and value.

  • Summary or copy of the company’s purchasing policies.

  • Copies of any supplier contracts or descriptions of any significant supplier agreements.

Contracts

  • Schedule of all subsidiary, partnership, or joint venture relationships and obligations with copies of all related agreements.

  • Copies of all contracts between the company and any officers, directors, 5 percent shareholders, or any of their respective families or affiliates and a written description of oral agreements or arrangements between the company and any related party.

  • Copies of any license, sublicense, royalty and franchise agreements, or equipment leases involving the company.

  • Schedule of all distribution, agency, manufacturer representative, marketing, and supply relationships and obligations with copies of all related agreements.

  • Copies of any letters of intent, contracts, and closing transcripts from any mergers, acquisitions, or divestitures during the reporting period.

  • Copies of any options and stock purchase agreements involving interests in other companies.

  • Copies of all standard forms and agreements used by the company.

  • Copies of all non-disclosure or noncompetition agreements to which the company is a party.

  • Copies of any agreements affected in any manner by a change in control of the company.

  • Copies of all management contracts involving the company.

  • Copies of any brokers or finders agreements applicable to the company.

  • Copies of any hold harmless indemnification or similar agreements of the company.

  • Copies of any contracts relating to other material business relationships, including, but not limited to

    • Copies of any current service, operation, or maintenance contracts.

    • Copies of any current contracts for purchase of fixed assets.

  • Listing of all contracts and agreements subject to renegotiation.

  • Copies of all contracts and agreements not previously requested.

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