Nowadays, M&A transactions are one of the key functions performed by VDRs (virtual data rooms). M&A and due diligence procedures are required when one company is purchased by another one, or when two companies consolidate into one. This is a set of complex transactions, and each one must be regarded closely and professionally. For example, prior to actually getting down to the procedure, each company (partaker) must be thoroughly analyzed and investigated to ensure that everything is according to the law, and no party will end up with its interests violated.
As follows from the above, due diligence in M&A a number one aspect. Those are the activities aimed at verifying participants’ legibility and legitimacy of their previous and current activities and intentions. No contract or agreement can be signed without the procedure.
Until recently, M&A transactions were mostly carried out in a traditional way. The procedure would take a tremendous amount of paperwork and strenuous checking lasting for days and months. Company representatives, lawyers, and other professionals would have to visit data rooms and monitor the whole process day and night. This is how land-based data rooms work. Now it seems a little obsolete.
M&A and finance research are complex matters. They require thorough research of information on both partakers, as not the smallest aspect should be missed. There are tons of factors, which must be taken into account, such as the following:
- Local tax and corporate law;
- Security regulations;
- Accounting policy;
- Financing procedures and strategies;
- Specifics of negotiations;
- Competitor bidders;
- Market conditions.
These and many other factors should be monitored closely during the M&A procedure. Until recently, it was long, routine and gut-wrenching.
Virtual data room M&A has changed all that. An online data room is a kind of service, the function of which is the same: warehousing corporate and sensitive information, which accompanies the factors listed above. There is little difference between land-based M&A in Hong Kong or elsewhere, except everything is in an electronic form and, therefore, much faster and easier. With an online data room at hand:
- It will be not so challenging to evaluate your future company’s potential liquidity and financial capability;
- You will have a much clearer picture of your capital;
- It will be easier for you to outline and choose a personal strategy;
- You will be able to ensure a safe and secure exchange of important information;
- You will have fewer organizational difficulties because you won’t need to travel to a data room office. There is an option to access data from any gadget, wherever you are.
These services act like websites, which clients can visit any time and manage their documentation. They are free to use in different ways to secure documents against unsanctioned access, viewing, copying, and distribution. Partakers do not face any restrictions when they access documentation stored in online data rooms.
Document security is paramount in any M&A finance operation, and every decent data room should place it first. They use some advanced tools and techniques to ensure safety. These include:
- Document expiry. This option ensures that a document will be destroyed once a third party tries to access it.
- Watermarking is performed in a dynamic way, as the option automatically adds the project name, user’s name, date of download, etc.
- Restricted viewing should limit the viewing scope for third parties to make reading impossible.
TOP Data Room Providers for M&A Deals in Hong Kong
There is a number of reputable data rooms, who provide high-quality M&A in Hong Kong. This region is one of the world’s biggest business clusters, and most companies headquartered here seek best M&A data rooms to find high-quality services.
Ansarada is among those data room providers, for whom M&A is the main (if not the only) focus. It uses a very effective pattern because it takes security and reliability very seriously. The company never misses a chance to upgrade its systems and acquire advanced software to guarantee maximum security to clients. They take the security steps mentioned above and more, and many Hong Kong businesses strive to cooperate with Ansarada.
iDeals is the name, which sounds right for what it means. It is another renowned M&A vendor, as it uses the latest data and access security techniques. Also, they use applications with simple interfaces, which, therefore, poses zero difficulties for clients, both minor and large ones.
Intralinks Dealspace has rich experience, as it has pioneered in M&A deals and due diligence – the main activities, which data rooms are trusted to do. The company provides services and software, which tracks and secures all sorts of corporate and sensitive data, and is supported by all popular devices and gadgets. They provide 24/7 support to their clients, as do all the top data room providers. With Intralinks Dealspace every M&A deal will be safe and simple.
How to Use Data Room for M&A
To use a data room for M&A in Hong Kong, you should first choose it. There are lots of them in the VDR market. Each one has its own experience, and not every procedure will be good for a particular company M&A.
There are things to consider when choosing a virtual data storage for M&A in Hong Kong:
- Access. Make sure documents open easily and can be viewed by all popular viewing tools and applications. Finally, there should be options, with the help of which the client can adjust access options to rule out the unsanctioned use of data;
- Security. It goes hand in hand with access. Make sure your vendor uses the techniques mentioned above (watermarking, document expiry, etc.) and other advanced security options;
- Whatever type of business you are running, choose a data room which has experience both with minor and major businesses;
- Make sure the vendor provides 24/7 support and hires agents, who can answer all FAQs;
- Make sure the vendor uses a report format, which suits your preferences and needs;
- Pay attention to the search tools a particular vendor uses. You should not have difficulties finding a document in the repository;
- Be sure that this is something you are ready to pay for. Read virtual data room reviews but don’t hesitate to make your own research.