We are entering the exclusivity window under our signed LOI, but our M&A advisor warned us about buyer-induced deal fatigue. How do we structure the due diligence schedule and closing milestones to prevent the buyer from dragging out the process to force late-stage concessions?

Question

Tyler Smith · Accepted Answer

A buyer gains significant leverage the moment you sign an exclusivity agreement. Once you take the business off the market, other bidders disperse, and your daily operating focus gets fractured. If a buyer senses you have deal fatigue, they will purposefully slow-walk legal drafting, flood you with repetitive diligence requests, and wait for a bad month so they can re-trade the purchase price days before closing.

To maintain control from LOI to close, establish rigid process governance before signing exclusivity.
- Cap exclusivity at forty-five to sixty calendar days, with an extension permitted only if the buyer delivers fully drafted definitive documents and debt commitment letters by day thirty.
- Demand a comprehensive diligence request list within five business days of signing rather than tolerating rolling, open-ended document inquiries.
- Run a weekly Level 10 Meeting strictly for your deal team, tracking diligence milestones on a dedicated Scorecard and assigning clear Rocks to your M&A attorney, CPA, and Integrator.
- Shield your operational leadership team. Your sales, operations, and finance leads must hit their quarterly Scorecard measurables regardless of diligence volume. Any drop in performance during exclusivity gives the buyer legitimate justification to trim their multiple.
- Require the buyer to confirm in writing at the thirty-day mark that their financial model and Quality of Earnings review have validated the headline enterprise value.

If a buyer misses critical deadlines without contractual justification, execute your right to terminate exclusivity. The willingness to walk away from a stalled transaction is your only real leverage once diligence begins.