Pre-LOI Questionnaire

Table of Contents

In M&A, gathering critical information early on is essential for making informed decisions. To assist our clients and community in quickly evaluating potential acquisitions, DueDilio is proud to offer a comprehensive Pre-LOI (Letter of Intent) Questionnaire. This template is designed to help you gather crucial information about a target company before committing to a formal LOI.

What is a Pre-LOI Questionnaire?

A Pre-LOI Questionnaire is a document that contains a series of preliminary questions aimed at evaluating a potential business acquisition. It helps buyers gather essential information about the target company’s operations, financial health, and potential risks before drafting a formal Letter of Intent.

Why a Pre-LOI Questionnaire is Essential

A Pre-LOI Questionnaire is crucial for several reasons:

  • Early Insights: Provides valuable insights into the target company’s operations and financial status.
  • Risk Identification: Helps identify potential risks and red flags early in the acquisition process.
  • Informed Decision-Making: Assists in making informed decisions about whether to proceed with a formal LOI.
  • Efficient Evaluation: Streamlines the due diligence process by gathering critical information upfront.
  • Strategic Planning: Helps in planning the acquisition strategy and integration process.

Key Components of Our Pre-LOI Questionnaire

Our Pre-LOI Questionnaire covers all critical aspects of a potential acquisition. Here’s what you’ll find inside:

Deal Information:

    • Deal specifics, broker/source, estimated check size, and valuation.
    • General comments and notes.

Ownership and Management:

    • Details about the original owner, ownership structure, and involvement.
    • Information on staff, including full-time employees and contractors.
    • Current lawsuits, major insurance claims, and regulatory issues.
    • Impact of lockdowns on sales and operations.

Operational Roles:

    • Roles filled by owners and potential for existing staff to take over.

Employee Relations:

    • Trade union memberships and related details.

Competitive Position:

    • Competitive edge, pricing strategy, and market position.

Financial Health:

    • One-off financial events, profitability, growth rate, and lifestyle expenses.
    • Loans and lines of credit.

Customer Base:

    • Customer acquisition methods and key customer problems solved.
    • Revenue distribution among top customers.

Sales and Marketing:

    • Management of website and digital marketing.
    • Monthly advertising and marketing spend.
    • Customer acquisition channels and effectiveness.
    • Pricing decisions and growth potential.
    • Risks and recession performance.
    • Industry outlook and critical staff reactions to an acquisition.

How to Use the Questionnaire

Using our Pre-LOI Questionnaire is straightforward:

  1. Download the Questionnaire: Click the link below to download the questionnaire.
  2. Customize for Your Needs: Tailor the questionnaire to address specific areas of interest or concern in your evaluation.
  3. Gather Information: Use the questionnaire to guide your discussions and information gathering about the target company.
  4. Analyze Responses: Review the responses to identify strengths, weaknesses, opportunities, and risks.
  5. Consult with Experts: Consider engaging M&A, financial, and legal experts to validate your findings and provide additional insights.

 

Conclusion

 

At DueDilio, we’re committed to providing the tools and resources you need for successful business transactions. Our Pre-LOI Questionnaire is designed to simplify the evaluation process and offer peace of mind. Download it today and take control of your acquisition evaluations with confidence.

Download Pre-LOI Questionnaire

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FAQ

Frequently Asked Questions

A Pre-LOI Questionnaire is a document that contains a series of preliminary questions aimed at evaluating a potential business acquisition. It helps buyers gather essential information about the target company’s operations, financial health, and potential risks before drafting a formal Letter of Intent.

A Pre-LOI Questionnaire is essential for providing early insights, identifying potential risks, making informed decisions, streamlining the due diligence process, and aiding in strategic planning for the acquisition and integration.

Our questionnaire includes:

  • Deal Information
  • Ownership and Management
  • Operational Roles
  • Employee Relations
  • Competitive Position
  • Financial Health
  • Customer Base
  • Sales and Marketing

Yes, the questionnaire is designed to be customizable. You can tailor it to address specific areas of interest or concern in your evaluation.

While the questionnaire provides a comprehensive framework, engaging M&A, financial, and legal experts can help validate your findings and provide additional insights. Experts ensure a thorough and accurate assessment.

The questionnaire helps identify potential risks and red flags early in the acquisition process by asking detailed questions about the target company’s operations, financial health, and potential liabilities.

Review the responses to identify strengths, weaknesses, opportunities, and risks. This analysis helps you understand the target company’s capabilities and areas that may require attention or improvement.

To download the Pre-LOI Questionnaire,  you will need to fill out a short form with your contact information, and a link to download the questionnaire will be sent to your inbox.

Important Disclaimer:
The information provided in this document is for general informational purposes only and does not constitute legal or financial advice. DueDilio does not make any warranties or representations for the completeness, reliability and accuracy of the information provided herein and does not assume any responsibility for errors or omissions in the content thereof. For the avoidance of doubt, any person’s use of or reliance on the contents of this document is strictly at their own risk, and DueDilio shall in no event be liable in any way whatsoever for such use or reliance. Users of this document should contact their attorney to obtain relevant legal advice in this regard.

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Picture of Written by Roman Beylin

Written by Roman Beylin

Roman Beylin is the founder of DueDilio, a leading online marketplace to assemble an M&A deal team. Our large and growing network of highly vetted independent professionals and boutique firms specialize in M&A advisory, due diligence, and post-acquisition value creation.

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