Mergers & Acquisitions For Dummies

Chapter 16

Knowing What to Expect on Closing Day

IN THIS CHAPTER

Rounding up the closing’s participants

Executing the actual closing

Considering working capital adjustments

After the due diligence is completed and the purchase agreement finalized, closing time is nigh. Closing the deal occurs on a day called, ingeniously enough, closing day, where both parties sign the agreements and the money changes hands.

Although this setup seems simple and pretty straightforward, failure to be prepared can cause unexpected problems. When you’ve gotten this far, the last thing you want is to have the deal fall apart at the last minute because of a lack of planning.

In this chapter I introduce you to a day in the life of a closing: what happens, what to expect, and how to successfully close a deal.

Gathering the Necessary Parties

In the olden days (you know, before the advent of the Internet), closing day meant lots of people gathering in an office, signing a boatload of documents, perhaps haggling over last-minute details, and exchanging the money.

Today, most if not all closings are virtual, meaning they occur by fax and e-mail. Each party gathers in its respective lawyer’s offices, signs ...