Stout provided reverse due diligence to a public company in the pharmaceutical industry being acquired by another public company in the same industry. Stout assisted in assessing the financial health and quality of earnings of the acquiring entity.

The diligence procedures included reviewing all SEC filings, earnings call transcripts, and publicly available information, as well as communicating with the acquiror management team. The business had significant merger and acquisition activity, unique royalty arrangements, concentration considerations, litigation matters, a unique equity structure, and complex assumptions factored into its earnings guidance.

Stout ran an expedited process and assisted the acquiree in establishing board materials, which further supported the client’s understanding of the impact of the stock-for-stock deal.