Assess whether integration costs were sandbagged in the CIM (a5ddfd)

Situation

Carve-out stranded-cost model arrived with a CIM that omitted a material litigation for integration-risk PMO. That is a M&A Due Diligence People and Contracts decision on integration costs were sandbagged in a PE platform evaluating a founder-led SaaS add-on.

Decision

Integration-risk PMO in a PE platform evaluating a founder-led SaaS add-on must choose Proceed / Reprice / Walk / Hold using carve-out stranded-cost model after a CIM that omitted a material litigation.

Hypotheses to test

• A CIM that omitted a material litigation is noise around an already-controlled People and Contracts process in a PE platform evaluating a founder-led SaaS add-on, given carve-out stranded-cost model.
• A CIM that omitted a material litigation is the event in carve-out stranded-cost model that forces Proceed for integration-risk PMO under M&A Due Diligence.
• Carve-out stranded-cost model shows a one-file miss after a CIM that omitted a material litigation, not a People and Contracts program failure.
• Carve-out stranded-cost model cannot decide integration costs were sandbagged yet after a CIM that omitted a material litigation; hold is the only M&A Due Diligence close a PE platform evaluating a founder-led SaaS add-on can defend.

Analysis required

• Tie quality-of-earnings, working-capital, and contingent items in carve-out stranded-cost model to integration costs were sandbagged.
• Name the document integration-risk PMO still needs before signing.
• Test whether a CIM that omitted a material litigation is a diligence gap, a price chip, or a walk-away.
• For this M&A Due Diligence People and Contracts file, read carve-out stranded-cost model against a CIM that omitted a material litigation and write the one fact that would move integration costs were sandbagged for integration-risk PMO.

Recommendation

Choose Proceed / Reprice / Walk / Hold on this M&A Due Diligence / People and Contracts packet (carve-out stranded-cost model after a CIM that omitted a material litigation). The follow-on People and Contracts action is what integration-risk PMO does next: implement the option, assign an owner, and log the missing fact.