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Applying VDR System to Streamline the Process of M&A Deals

Digitization and new technologies present existing organizations with new challenges and create unique offers and business models. This article will explain the prospects of organizing M&A transactions in a virtual data room.

The peculiarities of the M&A deal management

Mergers and acquisitions (M&A) are forms of reorganization of public joint-stock companies to increase the authorized capital, assets, and other benefits. Situations often arise when enterprises need to merge into one legal entity, liquidating the old ones to survive in a competitive market. By combining common assets, financial resources, technology, management, and patents, a single company will have much more opportunities for entrepreneurial activity.

The M&A process is costly and lengthy and can take up to 1 year. During this period, it is necessary to prepare all the essential documentation and consider the interests of shareholders, creditors, counterparties, government agencies, and top management. The M&A deal management requires severe efforts and specialists from various fields: a lawyer, an accountant, an economist, a top manager, a securities specialist, and an appraiser. In some cases, the number of people may increase, depending on the situation’s complexity. So, how to make the process of their communication coherent, and how to protect the file-sharing between contractors? In this case, a virtual data room (VDR) is the best solution. The data room serves as a secure digital repository and working environment for productive real-time collaboration. You can learn more about online vdr providers here.

The introduction of the data room software makes it possible to streamline several important business processes in the company. This tool helps to build an effective sales and marketing system and significantly improves customer relationships. Using the software product also allows you to increase the overall level of task completion and control employees’ work.

Helpful data room features to streamline the M&A process

The digital data room ensures various features to simplify the M&A workflows:

  • Automated deal management

Automating the M&A contract negotiation process (from drafting to signing) makes it more straightforward, manageable, predictable, and informative. Storing the attached files in the contract card will help to refuse to transfer on paper or by email all the documents necessary for the preparation, approval, and execution of the contract. Keeping a scanned copy of the signed document will save you from having to look for it on paper, especially if you are out of the office.

  • Reduced coast

Instead of operating a separate network drive and infrastructure for each location, the data room can be centrally in a certified data center. It not only increases general data security but also reduces the costs for the IT infrastructure, but all documents are always available at any location and on the go, in accordance with the respective rights. So, it no longer matters whether an employee has to access his documents in the office at his desk, on the road with a customer, or from his home office.

  • Control

The data room workflow module and email notifications make it easy to control key elements of the contract process and keep track of expiring contracts. Any changes in the main provisions will be reflected in the contract document itself, which does not require the analysis of all additional agreements. You can also view the history of their changes.