Mergers and acquisitions follow a predetermined flow that can be summarized, as follows:
1- LoI (Letter of Intent) or MoU (Memorandum of Understanding) that delimits the initial negotiations, being able to define value;
2- NDA (Non Disclouse Agreement) that protects sensitive information and fixes fines;
3- Due Diligence (Auditing) that identifies risks and confirms data;
4- SPA (Share Purchase Agreement) or QPA (Quota Purchase Agreement) or SHA (Shareholder’s Agreement) that regulates the main aspects of the corporate relationship;
5- Closing: closing the deal with payment and transfer of shares. There may be a waiting time between signing and closing called a suspensive condition;
6- Post Closing are the necessary actions after closing the deal.
The valuations and the setting of the transaction value usually occur at the beginning of the process and can be adjusted according to Due Dilligence and business conditions.