The General Data Protection Regulation (GDPR) is forcing
buyers and sellers to spend more to navigate an increasingly
time consuming due diligence process, and is having a big
impact on deal terms.
"It’s becoming more
common for non-disclosure agreements around due diligence to
include data related clauses but bidders can be uncomfortable
signing up to them," said Nigel Parker, partner at Allen & Overy. Instead, buyers are
asking sellers to remove personal data from the process which
can be a very time consuming and expensive process.
The regulation is also impacting deal terms, with buyers
increasingly demanding indemnification or seeking additional
warranties as a safeguard.
The regulation, which came into force in May, is making due
diligence a far bigger process than it had previously been, and
in some instances is completely derailing M&A deals when
the target company has...