The role of AI within a due diligence process

The due diligence process—whether for an acquisition, merger, venture capital investment, or audit—traditionally involves large volumes of documents, multiple sources of information (financing, legal, operations, market), and significant hours of manual review. In this context, AI emerges as a lever that can accelerate, automate, and enhance this process, enabling more informed and efficient decisions.

AI can automate the ingestion and classification of data from multiple formats and channels (PDFs, files, databases, web scraping). This includes legal documents, contracts, financial statements, market reports, and more. For example, Natural Language Processing (NLP) techniques can be used to identify key concepts, obligations, and specific terminology within contracts and other large documents.

AI can help detect patterns, anomalies, or "red flags" that might otherwise go unnoticed. For example, hidden relationships between executives and entities, dependence on a key supplier, indications of accounting fraud, or unfavorable contractual terms. It can also assist with compliance analysis, exposure to sanctions, reputational issues, and more.

AI can combine historical, operational, and market financial data to assess the health of the target company: liquidity, solvency, profitability, growth projection, etc.

It allows you to perform DuPont and sensitivity analyses quickly and easily. Furthermore, it can predict market trends, future behavior, and simulate scenarios, helping you make strategic decisions (based on which entity to acquire, its structure, etc.).

At ALLENIA, we can help you. If you're preparing for an acquisition, merger, or seeking investors for your project, incorporating AI tools into the due diligence process can make all the difference in terms of efficiency, risk, and profitability.