Minimizing Risk in M&A: How to Avoid Buying a Liability in Africa

Buying a business can be the fastest way to grow or the fastest way to inherit hidden liabilities. At Afrorian, we guide buyers and are often involved in providing experts to verify transactions or provide fractional expertise to comprehensive M&A due diligence by investors, PEs or consulting/Advisory?Legal firms to minimize risk and ensure strategic, confident acquisitions.

Why Due Diligence Matters in M&A

You wouldn’t buy a house without an inspection. Acquiring a company is no different. Due diligence protects you from taking on:

• Unpaid taxes or lawsuits
• Overstated revenue
• Poor employee contracts
• Aging or overvalued assets
• Unfavorable supplier/customer terms

Skipping diligence could mean overpaying or worse, buying a ticking time bomb.

What Asgard Reviews During M&A Due Diligence

Our due diligence process for buyers includes:

• Financial Analysis: Clean-up of financials, trends, margin analysis, normalization

• Legal Review Support: Flagging liabilities, leases, contracts, and litigation exposure

• HR & Payroll Review: Employee classifications, payroll accuracy, severance liabilities

• Asset Verification: Real condition checks for equipment, inventory, IP, and leases

• Contract Risk: Client/vendor contracts and dependencies

We don’t just look for problems, we help quantify their cost so you can adjust the offer or walk away.

Common Red Flags in Private M&A Deals in Africa

• Revenue spikes not tied to recurring clients
• Unreported tax issues or liabilities
• Major customers without contracts
• Family members on inflated payroll
• Lack of IP or IP not registered to the company

These issues can reduce valuation or destroy the deal entirely.

Afrorian’s Value: Mitigating Risk, Enhancing Confidence

Our experts works alongside your operational, legal or financial teams to:

• Identify local or regional risks BEFORE money is spent
• Support fair negotiation on valuation or deal structure-with currency fluctuations and specific country regulations
• Ensure lender confidence post-diligence

Industry experts act as your second set of eyes, without bias, with experience, and with your bottom line in mind.

Protect Your Capital. Protect Your Investment.

M&A can be the growth opportunity of a lifetime, if done right. Let’s make sure your next acquisition in Africa is strategic, compliant, and risk-adjusted to the market. Africa is so fragmented to implement the same strategies, ,use the same due diligence, or metrics to evaluate a deal. Find experts to work alongside you

Get started with an expert or fractional experts here