In the process of merger and acquisition an organisation will review the financial standing of the target company to ensure that there are no unforeseen liabilities that may cause seriousproblems for stakeholders following the merger.
In the same way there may be problems relating to health and safety which may lead to legal or financial consequences for the merged operation. In the same way as financial due diligence, issues may be uncovered which would lead the party planning the takeover to withdraw from the deal or vary theterms.
Examples of this are found in occupational health exposures where claims for diseases such as mesothelioma from exposure to asbestos, or noise induced hearing loss can arise many years after theincidents which have caused them.
With the advent of Corporate Manslaughter, potential fines can be in excess of £500,000 if a fatal incident has occurred through a failure at senior management level to effectively manage health and safety.