TRANSACTION ADVISORY

Our team at RRG assist companies planning to sell their business, exit or raise capital and help them comprehend tax and legal implications of a potential transaction. RRG assist companies with financial and legal due diligence, business valuation and model-building. Also, our in-house experts support such companies in improving their EBITDA or working capital levels which can boost the valuation of their business or their after-tax deal proceeds. We ensure that accounting team of our clients planning to sell their company or take on a private equity investor, are fully prepared for their due diligence.

Also, M&A activity in India has been growing rapidly over the last 5-6 years, aided by increased foreign investment and changes in Government policy. As deals grow in size and become more complex, the regulations surrounding M&A also grow more stringent. Both the target and the acquirer require expert guidance and advice on financial facets of the transaction and their implications for them.

Our Transaction Advisory Services team works with Buyers, Sellers, Private Equity (‘PE’) funds including Indian and Foreign individual or corporates.

There are several aspects that need to be considered before a merger or acquisition or investment or sell transaction can be initiated and completed. Here are some of them :

Due Diligence service: This is the first and basic check that needs to be done. The financial statements of the company that is set to be merged or acquired needs to be minutely scrutinized, and this should be done for at least the previous three years. Additionally, the company’s tax position and tax liabilities, employee liabilities, asset positions, etc. all need to be investigated by an independent third party.

Company Valuation in India: Another decision for the buyer or seller is to check how much the company is actually worth. While this is ultimately a negotiation matter, it is always important for both parties to enter the negotiation with a well-supported value that they would buy/sell for.

Transaction Advisory Services: The entire gamut of regulatory and financial checks that are needed during any M&A or transaction require support from consultants that provide transaction advisory services.

Buy-side Advisory: We help clients in planning the acquisition strategy, comprehensive due diligence, structuring domestic & cross border tax issues, searching for potential targets, negotiate a fair value, close and post-close integration.
Sell-side Advisory: We assist clients in achieving the most favorable valuation, develop appropriate negotiation strategies, conducting detailed seller diligence and Minimize impact of taxes.

Business Valuation of Companies: The correct value of the company that is being merged or acquired needs to be ascertained so that the shareholders of the acquiring company do not get shortchanged with this transaction. Business valuations are required for various purposes including accounting, taxation, RBI/forex, fairness opinions, etc.

FEMA Valuation Service or RBI valuation service: The Foreign Exchange Management Act governs all transactions involving the outflow or inflow of foreign currency. If an M&A deal involves a buyer or seller outside India, valuation needs to be done under FEMA by an external expert to prove that there is no underpayment or overpayment.

RRG’s team brings its cross-cultural and cross-sector experience in transaction advice to the task, assisting clients with the following services:

Lead advisory, target evaluation studies, fund raising
Financial model building for companies looking to raise funds
Financial due diligence for proposed transactions
Tax due diligence for proposed transactions
General due diligence for a proposed transaction (encompassing financial, tax, legal and key operational aspects of the business)
Valuation of business for transactions
Valuation of business for regulatory purposes, e.g. for foreign exchange inflow/outflow (FEMA requirements), for Companies Act purposes and for shareholder protection purposes
Valuation of business for tax purposes, e.g. capital gains tax for the seller, income from other sources for the buyer, etc.
Determination of transaction structure and equity stake to be allotted to buyer based on valuations
Tax planning for a transaction for both acquirer and target
Valuation of intangible assets of a business, e.g. customer relationships, brands, technology, etc.
Purchase price accounting for a transaction, i.e. determining the fair value of all assets and liabilities (including goodwill) of an acquired entity
Ongoing valuation of business and/or assets on a periodic basis for financial reporting, mark-to-market measurements and impairment analysis
Restructuring analysis and strategy
Transition planning and guidance