Docutone Virtual Data Room, Logistics, Singapore Private Placement
A Docutone Virtual Data Room is more remarkable than mere data. In complex transactions, such as private placements, distinctive software and processes can even point out who the main players are.
In May 2018, Singapore logistics company Mapletree Logisitics Trust raised over SGD $200 million selling private placement shares with proceeds funding the acquisition of logistics properties in China. Such a complex transaction would have presented a number of challenges, not least of which is how to balance practical efficiencies with transparency and security. Here, we take a look at some of Docutone’s best practices.
VDR case study in a private placement
Initial assessment: Financing options may include private placements, for which analysts have to review large volumes of documents. The VDR set-up helps you to collate and share this data with specific users. A company seeking financing uploads documents into indexed folders. Data is safely encrypted and managers can track user-engagement to ensure that their analysts are on the mark with due diligence.
Marketing a deal: If a private placement is preferred, an information memorandum is prepared for potential investors. These could well be competitors, which requires extra care when sharing information. A private equity firm using a VDR would present a ‘key’ to potential investors to review documents. The VDR tracks user engagement and can run reports on the most active users – those reviewing financial documents and more likely to emerge as the main contenders to be prioritized.
Negotiations: During negotiations, multiple internal and external teams will perform due diligence while crafting their terms and conditions. With a single platform for document management, all parties can quickly access the latest document versions, and also new documents being added. The final drafts may be published in the VDR for disclosure.
As deals close, advisory firms open a separate VDR for investor reporting. Private equity firms and investors value transparency, and firms that handle buyer and investor expectations with integrity gain the upper hand. All this is now possible with a powerful platform, the Docutone Virtual Data Room.
Docutone Virtual Data Room, M&A Buy Side
You’re a financial advisor in a merger and acquisition (M&A) transaction for a Chinese client seeking to invest overseas. Your client sends its team consisting of members from its corporate finance and legal departments, in addition to foreign legal counsel to review the due diligence process. You have to coordinate the foreign team, the decision-makers based in China and the sellers.
How do you manage the information flow? What can you do to be more competitive during the bidding process?
M&A in cross-border transactions
When dealing with a cross-border M&A, bringing together international buyers and sellers, dealmakers are tasked with executing the transaction competently, seamlessly and quickly. Docutone DataRoom connects all parties in real-time to professionally manage the due diligence process.
A VDR is an industry best-practice tool used to share and monitor documents as they are filed for scrutiny, and control the flow of information to protect the privacy of the parties concerned. It is commonly used in regulated industries, especially in the capital-markets space for efficient due diligence for complex transactions.
So how does it work?
As an advisor to this deal, you create a VDR branded under your firm’s or your client’s company name. You then set up the VDR index where potential overseas sellers can upload their documents in an organised way. Setting up a well-planned index means that you can easily check if the seller has provided all due diligence documents needed for review.
When all the documents are in place, your clients can go through their due diligence process in a systematic way. Your deal moves quickly. Question-and-answer forums are streamlined and secure. Sellers can also rest assured that their highly sensitive information is being handled with discretion and without breaches.
Especially with cross-border transactions, it is vital that data access is seamless within and outside China. Overseas sellers must be able to upload their documents to the VDR with speed where the decision-makers in China can access these documents securely and without any delayed connectivity issues. Docutone VDR is built for a global user base, with speed and connectivity guaranteed regardless of a user\’s physical location.
A record year for Chinese M&A 2018?
As analysts look to strong outbound deals in technology, industrial and consumer products, it remains critical that financial advisory firms address due diligence processes competently, using new technologies and best practices.
ADLYN ADAM TEOH
Legal, Master Data Mangement, Transaction Deal Bible
E-bibles (or document bibles) are commonly used by legal firms to organize case documents to share with clients at the end of a deal or to store within their internal libraries.
As Chinese law firms start to store their e-bibles in the cloud, they have brought along with them their clients in adopting best practices of storing, indexing and deep searching of large volumes of documents.A project with many moving parts, we recommend adopting practical project delivery best practices with these 3 key topics:
- Digital and Print Merging
- Data Management for Classification and Indexing
- Project Implementation Process
1. Digital and Print Merging
Optical Character Recognition (OCR) technology is key in delivering print to digital documents. As many final documents contain company stamps and signatures and supporting documents being in hard copy, applying OCR software to digital documents should come hand-in-hand from the start of a project. The goal is to fully convert paper documents to being 100% text searchable documents.
2. Data Management for Classification and Indexing
Even when hard copies are text searchable, a pain point for many is that a search process is often inundated with search results that may not be relevant. In many cases, you will need to speak to someone familiar with the transaction, if they are still around, to identify your required documents. While not ideal, this is the reality of most document searches. Classification by deal type and keywords for indexing sets the basis for easy searching. In addition, executive summaries should be revisited and updated if necessary, to be concise and to allow readers a rapid appreciation of the transaction content. As transactions get more global in nature, it is best to have keywords and summaries in both English and Chinese.
3. Project Implementation Process
The key to ensuring that project sponsors and stakeholders achieve their desired outcome is to conduct a Conference Room Pilot (CRP) earlier in the project implementation phase. Key users will be able to visualise the process and results, while the project team identifies and addresses gaps. CRP2 prior to User Acceptance Testing (UAT) and finally the End User Training is also vital. With training, users will easily locate, view and print the information they need – and use the e-bible as a dedicated and reliable reference source.
Taking it a Step Further with Analytics
With a treasure trove of data in their hands, firms not only solve the issue of easy sharing and access, but can also take the opportunity to use their data in spearheading future data analytics projects down the line.
ADLYN ADAM TEOH