What buy-side diligence should add to a VDD report

Vendor due diligence is commissioned on the seller's side to prepare a structured presentation of the activity and facilitate discussions with buyers. Buy-side due diligence is conducted to answer a buyer's specific questions. I would distinguish these purposes without assuming that a VDD report is unusable or that a professional buy-side review necessarily discovers an error. Both can rely on the same data while examining different issues.

The buyer must understand the procedures, scope and date of information in an existing report. The conditions of access, use and reliance must be examined with the councils concerned; they are not deduced from the mere fact that the document is available. Reading a report does not mean that the professional who produced it assumes responsibility towards all his readers.

I would start with entities, periods, sources and procedures. Only then would I read the bridges and conclusions. A good report may be insufficient for the buyer if the purchasing scope has changed, if the last quarter is missing or if the pricing mechanism requires specific work. These limits are not defects in themselves: they describe what was requested and carried out.

I would distinguish between supported findings, management explanations and presentation hypotheses. A proposed standardization can be well documented while remaining questionable in the valuation context. A trend can be correct on history without representing recent trading. The professional review must identify these differences and avoid unnecessarily redoing sufficiently covered analyses.

I would draw up a map of the buyer's needs in relation to the existing work. Topics already covered can be corroborated with targeted testing. Missing subjects require additional procedures. This approach focuses time on the risks of the decision instead of reproducing a full report. It must nevertheless remain compatible with the mandate and requirements of the team which signs its own conclusions.

Priorities will depend on the file. A financial acquirer can look specifically at cash conversion and normalizations. An industrial buyer may request clarification on separation costs or commercial dependencies. The synergies of this buyer should not be incorporated indiscriminately into the historical EBITDA of the target. Their existence and their realization are subject to another analysis.

The VDD ends in September. The fourth quarter result was 0,9 M€ compared to 1,2 M€ over the comparable period, a decrease of 300 k€. I would start by confirming comparability: scope, accounting methods, number of days, closing entries and degree of finalization. The decline is trading information before being a proposal for adjustment.

We must then understand the causes: volumes, prices, mix, costs, seasonality or particular incident. A persistent commercial loss can modify the assessment of the run-rate without being qualified as a non-recurring cost. An exceptional charge must be examined separately with its proof. Automatically adding 300 k€ to EBITDA would erase a drop in activity without demonstrating why it would be temporary.

The buy-side conclusion can therefore be a valuation sensitivity, a request for additional information or a revision of expectations. It does not need to take the form of historical normalization. I would keep the distinction in the report: what the data establishes, what management explains and what the buyer must decide.

I would prepare the questions based on the documented discrepancies. Each question must specify the period, amount and source, then ask for an explanation or an identifiable document. Accusatory wording can close the discussion without improving the evidence. Vague wording often produces an unusable general answer. The objective is to understand, corroborate and decide on treatment.

The register of responses must distinguish what is asserted from what is received. A transcript is useful for retaining nuance, but it does not transform an oral response into sufficient evidence. The versions of the report must show the additions made and the points remaining open on the return date. This tracking is particularly important when multiple buyers receive information at different times.

The AI can offer a mapping of topics between VDD, SOW buy-side and dataroom, or identify different dates. I would test for omissions and false discrepancies: a section can be treated in an appendix under another name. The professional must assess whether the available procedures meet the need. The similarity of text proves neither equivalence of works nor right of reliance.

A workflow like the one presented by Solenor can be evaluated on the links between findings, sources, Q&A and updates. I would look for a file that allows the manager to trace additional work, rather than a shorter report summary. The VDD is a useful starting point when it is included within its scope; the buy-side brings the necessary challenge to the particular decision of the buyer.