A virtual data room is an online repository of information that is used for the storing and distribution of documents.
In many cases, a virtual data room is used to facilitate the due diligence process during an M&A transaction, loan syndication, or private equity and venture capital transactions.
A syndicated loan is one that is provided by a group of lenders and is structured, arranged, and administered by one or several commercial banks or investment banks known as lead arrangers.
Mergers and acquisitions are transactions in which the ownership of companies, other business organizations or their operating units are transferred or combined.
Due diligence is an investigation of a business or person prior to signing a contract, or an act with a certain standard of care.
This due diligence process has traditionally used a physical data room to accomplish the disclosure of documents.
For reasons of cost, efficiency and security, virtual data rooms have widely replaced the more traditional physical data room.