Today cybersecurity plays a bigger role in Mergers and Acquisitions (M&A) than ever before. Several acquiring companies have suffered big losses when acquired companies have been breached. In many cases acquired companies have been found not to be compliant to critical cyber regulations. This can result in significant financial loss that could have been avoided if cybersecurity due diligence had been conducted.
During an M&A transaction, the acquiring company conducts due diligence to better understand the risks. Such an assessment address areas such as finance, technology, HR, supply chain, marketing, and sales. Similarly, the acquiring company should conduct cybersecurity due diligence to understand potential risk areas in the target organization. It is important that the DD includes any subsidiaries and third-party vendors. The Due Diligence allows the acquiring company to identify cybersecurity related risks before entering an agreement.
If you are looking to acquire a business and need help with the Security Due Diligence, Seadot Cybersecurity has extensive experience and can support you. Contact us and we can discuss.