In order to successfully carry out an acquisition, the managers at Pink Inc. prepared a list of potential target companies that it could purchase. In the next step, the managers evaluated each prospective company in depth to understand their methods of operations, processes, procedures, strengths, and limitations in order to choose the best target company. This process of evaluating the companies is best known as _________.

Question

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Due diligence involves a comprehensive and systematic analysis and investigation of a target company's operations, financials, legal, and regulatory compliance before proceeding with an acquisition. It includes reviewing contracts, financial statements, tax records, intellectual property portfolios, regulatory compliance, and other operational aspects of the company to ensure that there are no hidden liabilities or red flags. Hence, the process of evaluating each prospective company in-depth aligns with the process of due diligence. Market intelligence, consultation, and market evaluation are different processes that are not directly related to evaluating target companies for an acquisition.

In Order to Successfully Carry Out an Acquisition, the Managers