Vendor Concentration Challenge

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August 06, 2023

by a searcher in Tulsa, OK, USA

Under LOI on a B2B healthcare product company.
After going under LOI, I learned that the vendor contract does not have an end date but can be canceled by either party with a 60-day notice. The vendor's products compromise north of 25% of revenue.

This feels like a substantial risk. What can I do to mitigate the risk before closing the deal?

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Reply by a searcher
in Petaluma, CA, USA
If you have a seller carry or holdback, you could make it partially contingent on the contract not going away within a certain time period post acquisition (eg: 12 months)
commentor profile
Reply by a professional
in New York, NY, USA
What's the result? Is this still on the table ?
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