Purpose-Built Data Room Platforms for M&A Deals

Most data storage hacks happen because sensitive files are accidentally made public. Take a look at the best purpose-built data room platforms for M&A in the article below.

The Best Purpose-Built Data Room Platforms for M&A Deals

It is more difficult to assess who won or lost from an M&A transaction (that is, sold too cheap or overpaid) than, for example, in the stock market. This is a complex and lengthy process with large sums at stake. Successful players in the M&A market know its rules: they do not hope for an immediate result and make informed decisions (although not everything can be taken into account, many factors might not have existed at the time of the transaction).

The virtual data room platform for M&A deals is an online archive that will contain the necessary documentation for the target company and will significantly reduce the number of communications and questions from the buyer. And if there are several buyers, for example, for a startup that attracts investments, Data Room will allow you to set up a different level of access, depending on the stage of the agreements, and at the same time introduce potential investors to each other.

Among the best purpose-built data room platforms for M&A deals are:

  1. Intralinks. 

  2. DealRoom. 

  3. Brainloop. 

  4. iDeals. 

  5. ShareFile. 

  6. Box. 

  7. Merrill. 

  8. V-Rooms.

Why Is It Highly Recommended to Use Purpose-Built Data Room Platforms?

It’s also much easier to keep track of what types of documents are printed and who needs to print them for management purposes. There are also options for the tool, depending on the needs of the virtual data room user. Thus, a full audit is carried out in order to identify all potential shortcomings and losses that a transaction can lead to if it was not initially developed and evaluated properly. And only after a full check you make a decision to conclude a deal.

Be aware that there is a common misconception about services like Dropbox or Google Docs. While these applications are useful for sharing files, they may not provide the same level of data security as VDR in . Moreover, their functions are limited and do not include the services necessary for negotiations, audits, and so on. It is highly recommended to use the purpose-built data room platforms for M&A because:

  • Investments for the purpose of obtaining investment income in a promising business.

  • Partnership.

  • Motivation for business development.

  • Checking the legal form of the company, and constituent documents.

  • Checking the composition of the founders, members of the board, their powers, and responsibilities.

  • Checking the structure of the company, subsidiaries, and representative offices.

  • Checking the authorized capital and property of the company.

  • Analysis of the intellectual property of the company.

  • Data and applications can move between private and public clouds, providing greater flexibility and more deployment options.

An important point to consider when drafting a data room platform for M&A deals is how to identify the confidential information itself. Two extremes should be avoided here, that is, too vague and too narrow formulations. If it is written in the contract that, for example, only information about the assets and financial condition of the company is considered confidential, this can exclude a large number of necessary nuances. On the other hand, often, the seller tries to declare confidential any information transferred under the M&A between the parties.