M&A due diligence in general is considered an overall investigation of the target company and is often called "Baishu Kansa (acquisition audit)", "Shisan satei gyomu" (asset assessment)" or "Jizen shousai chosa" (pre-detailed investigation) in Japanese. The due diligence process is an extremely important part of the M&A process as direct access to the target company is made possible through, for example, interviews with management and employees and on-site visits to factories etc. Buyers may negotiate a lower purchase price if damages to the value of assets key to the transaction are found, or negotiate the terms of indemnification if unexpected contingent liabilities come to light as a result of due diligence. In some instances, a "deal breaking" matter or, information that may affect the buyer's decision to go ahead, may be found. In this sense, one can say that due diligence is a crucial part of the M&A process in that it holds the key to the success of the transaction as it allows the buyer to avoid incurring as much contingent losses as possible after the acquisition.

Although it is clear that the due diligence process, as described, is extremely important for clarifying the risks before committing to an investment, unfortunately in Japan, due diligence is considered to be a somewhat negative process of "finding flaws" of others. For this reason, due diligence has been confined to a kind of third-party-approval report or a fragmentary research based solely on accounting books, leading to many failed deals for Japanese companies in the past.

The professional staff of DCo, with its abundant M&A and advisory experience, will not create third-party-approval reports or simple accounting book reviews but will be fully committed to take on due diligence with a goal to flush out all risks associated with the investment as well as provide action plans to tackle crucial issues found through the process, to provide unparalleled professional advisory services that will lead to a successful M&A transaction.