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.
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.