Data room (due diligence)

The data room is the central information source in a bidding process: a password-protected online platform (for larger cases often a dedicated provider like Datasite or Intralinks; for smaller deals frequently just a shared folder) where the administrator or their advisor provides contracts, management accounts, headcount lists, lease and supplier agreements and, where relevant, legal documents to registered prospects, usually bound by an NDA.

In insolvency, the data room is typically noticeably thinner and less complete than in a healthy business sale — historical figures are often patchy, contracts aren't fully archived, and the administrator themselves has only known the business for a short time. Buyers should actively ask for missing documents rather than mistaking gaps for the absence of relevant issues.

Sequencing matters in practice: serious prospects usually first get a narrow „teaser” data room (short profile, headline figures) and full access only after signing a non-disclosure agreement (NDA). Bidders who quickly deliver a credible indicative offer typically get preferential, deeper access — speed is its own competitive factor in an insolvency bidding process.