Cybersecurity due diligence is a critical component of any M&A transaction, ensuring buyers understand the risks, vulnerabilities, and security posture of a potential acquisition target. With data breaches and cyber threats on the rise, failing to assess a company's security infrastructure can lead to unexpected liabilities, regulatory penalties, and reputational damage. Conducting comprehensive cybersecurity due diligence helps buyers evaluate risks, renegotiate terms, or walk away from deals that pose significant security threats.
Key areas of cyber due diligence include reviewing the target’s incident response plan, assessing compliance with industry security frameworks (such as NIST, ISO 27001, and SOC 2), and conducting penetration testing to uncover hidden vulnerabilities. By implementing a structured cybersecurity assessment, organizations can ensure they are acquiring a secure and resilient business, protecting themselves from post-acquisition data breaches, legal exposure, and costly remediation efforts.
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