Virtual data rooms are crucial in ensuring that the acquisition process is as smooth as possible. That is according to Arie Maree, director at Ansarada, a world leader in merger and acquisition technology and headline sponsor of the Knife Capital Exit Conference, held at the Sandton Convention Centre on 21 August. A virtual data room is a limited-access website or software platform that bidders and advisers can use to peruse confidential corporate information before making a decision to purchase. These rooms offer significant cost savings on physical centres, especially when large teams of experts are required to perform extensive due diligence processes. They can be used for data storage, document exchange, file sharing, financial transactions and legal transactions, among other functions.
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Virtual data rooms are commonplace in the USA, Europe and Australia, but in many of the world's developing markets, its usage is still in its infancy. Physical rooms full of cumbersome documents are still a common sight in China and Africa. Virtual data rooms only began to be used in South Africa six years ago, but usage has grown in leaps and bounds since then, particularly in Johannesburg, as financial hub for Africa.
Maree advised CFOs exploring a potential sale to invest in a dedicated merger and acquisition virtual data room, bearing in mind that a data dump would hamper bidder due diligence and security was of paramount importance. When selecting a provider, look out for data rooms that can be accessed from a range of devices and that boast technology that speeds up Internet access. Other considerations include round-the-clock customer service, question-and-answer sessions that allow sellers and bidders to resolve issues early on in the process and complete archives of transactions when deals are completed.
Ansarada data rooms carry one low minimum fee that applies for 12 months. No usage fees (based on data size) apply until the first bidder logs in. The company has released a new version of its popular merger and acquisitions game, aiming to bring some fun to the helter-skelter world of investment banking.
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