What is Due Diligence?
Investment due diligence work assesses and addresses the risks that are attendant with a business investment or lending opportunity. To commit funds to a new venture, merger or acquisition, the project team and/or their backers require confidence that the project will perform in line with expectation and that no abnormalities are inherent in business plans.
The scope of an investment due diligence assessment will vary in line with the type of project, the investment structure, and the risk tolerances of the investor. When seeking institutional finance, lenders may also have specific requirements that need to be addressed.