Goodwill is an intangible asset that represents a substantial underlying factor to a company’s profitability and sustainability?
Intangible Asset Pre-Post Transaction Due Diligence
When negotiating any business transaction, particularly a merger or acquisition, intangible assets and intellectual property (IP) will be part of the deal.
We’ve come to know that investments in early stage companies and/or university spin-off’s, VC’s will require, and probably correctly so, putting in place management teams with experienced (intangible asset and intellectual property) oversight and stewardship credentials.
Among other essential responsibilities, the management team and the inventors absolutely must ensure that control, use, ownership and value and materiality of the invested IP and intangible assets is being monitored.
In M&A’s, if control, use, ownership, and value of about-to-be-acquired/purchased (intangible) assets can’t be sustained, there’s a high probability the desired – projected returns, synergies, efficiencies, etc., will be significantly impaired, diminished, or left unrealized altogether.
Acquisition due diligence and management should be designed and conducted to include pre and post contexts (components).
Because intangible assets and intellectual property (IP) are frequently key elements in mergers and acquisitions, its essential to ensure that due diligence fully assesses the status, stability, fragility, and defensibility of those assets to determine if control, use, ownership, and value can be sustained (practically and legally) post transaction.