Assess whether a top customer is actually sticky (f6e96d)

Situation

A CIM that omitted a material litigation put customer concentration and termination-for-convenience clauses in front of customer-contract risk reviewer in a strategic buyer looking at a carve-out from a conglomerate. This M&A Due Diligence / Separation and Integration close is a top customer is actually sticky from customer concentration and termination-for-convenience clauses, and the live options are Proceed, Reprice, Walk.

Decision

Customer-contract risk reviewer in a strategic buyer looking at a carve-out from a conglomerate must choose Proceed / Reprice / Walk / Hold using customer concentration and termination-for-convenience clauses after a CIM that omitted a material litigation.

Hypotheses to test

• Customer concentration and termination-for-convenience clauses reads as Proceed once a CIM that omitted a material litigation is lined up to the same M&A Due Diligence population.
• Customer concentration and termination-for-convenience clauses is closer to Reprice after a CIM that omitted a material litigation; Proceed would over-claim this Separation and Integration extract.
• Walk is still live in customer concentration and termination-for-convenience clauses for customer-contract risk reviewer in a strategic buyer looking at a carve-out from a conglomerate.
• Customer concentration and termination-for-convenience clauses is missing the fact customer-contract risk reviewer needs after a CIM that omitted a material litigation; stop this M&A Due Diligence close.

Analysis required

• Name the document customer-contract risk reviewer still needs before signing.
• Test whether a CIM that omitted a material litigation is a diligence gap, a price chip, or a walk-away.
• Separate a one-off add-back from a recurring earnings issue in customer concentration and termination-for-convenience clauses.
• For this M&A Due Diligence Separation and Integration file, read customer concentration and termination-for-convenience clauses against a CIM that omitted a material litigation and write the one fact that would move a top customer is actually sticky for customer-contract risk reviewer.

Recommendation

Choose Proceed / Reprice / Walk / Hold on this M&A Due Diligence / Separation and Integration packet (customer concentration and termination-for-convenience clauses after a CIM that omitted a material litigation). The follow-on Separation and Integration action is what customer-contract risk reviewer does next: implement the option, assign an owner, and log the missing fact.