This is Part 2 in a two-part series about a recent M&A deal in which PE firm Broadtree Partners purchased SAAS company, RedCAT Systems, which provides specialized HR services for major corporations like Uber, NYSE, and LinkedIn. 

This time we’ll be covering the Buyer’s side of the transaction with Rob Joyce from Broadtree. (Be sure to check out my conversation with Steven Epstein of RedCAT here.)

Importantly, Representations and Warranty insurance was a crucial part of this deal. Broadtree wasn’t too thrilled about having this coverage in place at first, but, as Rob notes in our conversation, they did eventually come on board. 

We talk about the initial reluctance to get R&W insurance… what changed their mind… and how this coverage changed the dynamics of the deal dramatically, as well as…

• How the due diligence process was delayed because of two key factors (this is something unique to this size of company and industry)
• The total cost of Rep and Warranty coverage – how it breaks down and who pays for it 
• Why they saw RedCAT as a worthwhile acquisition (great clues for startups here)
• The sticking points that delayed the deal along the way – and how they could have been avoided
• And more