Importance of Due-Diligence in Cross Border Mergers & Acquisitions - A Case Study of High-Tech Industry

The Due-Diligence is a critical evaluation process to be executed prior to taking decision of merger of two companies. This process plays a very significant role in cross border mergers of high-tech companies where technical, cultural, financial, legal and business parameters govern the success of the merger. This paper studies the merger of two high-tech companies located in different countries. The source company was interested to buy the target company to leverage the technological integration of both companies thus enabling development of a new cost optimized product. The focus of this paper is to examine various aspects of business such as finance & human factors influencing the post-merger performance, then reviewing challenges faced. Suggestions have been provided for careful considerations of some of important factors during the Due-Diligence process prior to the merger in similar integration scenarios. This study is mainly focused on high-tech industry though learning from the analysis can be applied to other industries as well.