Your trusted language partner
Today Translations is the language partner of choice for professional firms that conduct multilingual due diligence work as part of their M&A activity. The company is focused on the delivery of high quality services and has the people, systems and processes to pre-empt issues and swiftly adapt to the dynamic circumstances associated with due diligence activity.
Translate only what is needed
It is essential that important points are not overlooked or lost in translation during the multilingual due diligence process. However, there is little value in translating data that is not relevant to the process or the investigation of red flags that arise. Today Translations has pioneered a set of methodologies to reduce to a minimum the amount of material that requires translation such as the use of machine translation technology with human editing and the AMLiss™ process. Use of these methodologies can reduce the volume of content by 40%-60%.
Mitigate risk through quality and security assurance
Secure data handling is crucial during the M&A process. Any information leakage can disrupt the process and cause serious financial losses or reputational damage. You can mitigate these risks by working with a language partner that has quality and information security procedures in place that conform to international standards; have been independently verified by an approved certification body; and hold adequate professional indemnity insurance that covers the company and all their operatives.
Today Translations has introduced strict security measures to prevent security breaches and was the first specialist language services provider in the world to achieve independent UKAS-ISO27001 certification for its entire operations. The company’s quality procedures have been independently certified under ISO9001.
The robust security and quality processes have enabled the company to secure professional indemnity insurance that is scarce in the language industry as it covers the firm’s global network of linguists.
Importantly, the company has an international network of subject matter experts, who advise on how to reduce the risk of fraud, bribery and cyber-crime, as well as how to enhance multilingual communication. Drawing on this in-house expertise we have tailored a solution designed to be flexible according to your requirements and one that enables accurate spend calculation.
Factors to consider
The amount of translation work required to successfully execute mergers and acquisitions in foreign countries depends on a number of factors. These include:
* The political and economic risk ranking of the country where the deal is to be done.
* Whether the acquirer is using Global Legal and Accounting firms or local professionals for due diligence and deal administration.
* The proportion of due diligence being done by the acquiring company instead of advisors.
* The complexity of the business being acquired, in terms of corporate structure, ownership, fixed assets and operations.
* Whether Key Staff are being retained within the business after acquisition and whether they are critical to the integration and ongoing success of the business.
* Whether the deal is competitive or sole-bidder.
* The assessed value of Warranties and Representations from the vendors of the business; in other words, if claims are made against warranties will the vendor be able and willing to pay?
* The volumes of red flags or subsequent actions that are generated during the due diligence process and require investigation.
The list above is not exhaustive and each deal needs to be considered individually.
Due diligence translation checklist for M&A
The minimum that Today Translations would expect to see translated in an M&A deal is the following:
* The Sale and Purchase Agreement, in its entirety.
* Change of Control Clauses in all Customer and Supplier Contracts, and the entire contracts for customers and suppliers representing more than 10% of the revenue of the target or its supplier spend.
* Any Government approvals needed for the target to be acquired by a non-domestic company buyer.
* Banking and other funding contracts (such as Bonds, Debt Discounting) unless so minor as to be non-material.
* Contracts relating to the ownership or lease of key assets, and especially those critical to the operation of the business or the value of the business.
* Employment Contracts for all Key Staff to be retained in the business post-acquisition.
* Trade Union or Staff Association Agreements on employment terms and conditions.
* Last three years’ Annual Accounts and latest Management Accounts for the year to date.
* Correspondence relating to acceptance or challenge of last three years’ tax computations and any disputes over tax.
* Any documents relating to active or pending litigation and to contingent liabilities identified or declared.
Should the acquiring company be able to rely on its advisers to carry out the due diligence process thoroughly and competently, and to bear financial responsibility for any errors or omissions, then the translation requirements can be cut back to the agreed list that the Purchaser wishes to have checked by its Management. Today Translations maintains that in every case the Sale and Purchase Agreement should be translated in full so that the Directors and Officers of the Purchaser can be certain they are meeting their fiduciary responsibilities to shareholders.
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