You must cover all of these topics:

· The company's market position (relative to its competitors)

· Business Model (how sound is it?)

· An assessment of the company's sources of inputs and finance

· Risk management systems/corporate governance mechanisms in place (you may want to compare this with the requirements for listed companies on the London Stock Exchange, available on the Exchange's website)

· Financial Performance (look at the liquidity/working capital position, profitability, gearing etc. What can you improve to generate synergy?

· Expansion potential

· Strong franchise value- this is the best source of growth. Does your target company have one it's probably not maximising?

· Management team- poor management team is generally a motivation for takeover. There are ratios to calculate management efficiency.