🌟 Hello, Reader

Welcome to the ninth edition of KSMC Double Klick!

Let’s read into it right away.

Warm regards,
Kapil Sukhija
Founder, KSMC

📊 Deal Strategy Deep Dive

Technology Due Diligence: Who Really Owns the Technology?

What This Means: Technology due diligence is the comprehensive evaluation of a target company's technology assets, including software architecture, intellectual property, development capabilities, security systems, and scalability potential. This process assesses code quality, technical debt, cybersecurity vulnerabilities, and patent portfolios.

The Challenge: Technology due diligence must uncover invisible risks: Can the code handle 10x growth? Are there unpatched security vulnerabilities? Is the codebase dependent on outdated frameworks or single developers? Does the company actually own its IP, or is it built on improperly licensed open-source code? These questions determine whether you're buying an asset or a liability.

Why It Matters: Technology problems are expensive to discover late. Whether it's IP ownership disputes, technical debt requiring complete rebuilds, or security vulnerabilities exposing the business to breaches, issues missed during due diligence are costly to resolve and can derail the entire acquisition strategy.

Real Deal Example: Hidden technical issues can derail entire acquisitions. When eBay bought Skype for $2.6 billion in 2005, due diligence missed that Skype didn't own critical peer-to-peer technology ("Global Index") that powered its core calling functionality - it was licensed from Joltid, a separate company owned by Skype's founders. Joltid sued eBay over licensing of the peer-to-peer technology that Skype used to distribute calls. eBay failed to identify that core technology was licensed, not owned. The licensing terms weren't properly secured. This was discoverable during due diligence but was missed or inadequately addressed. Combined with broader strategic failures, eBay took a $1.4 billion write-down in 2007 and sold its majority stake just four years later, having learned an expensive lesson: verifying technology ownership is foundational to successful integration.

Framework Available: If you'd like to explore technology due diligence frameworks that catch these critical ownership issues, we can discuss how they apply to different deal types and industries.

🌍 Global Pulse

Buffett's Last Hurrah? Berkshire's $9.7B Bet on OxyChem

Warren Buffett is going out with a bang—or at least, that's what everyone's assuming!

Berkshire Hathaway is acquiring Occidental Petroleum’s chemicals division, OxyChem, in a $9.7 billion all-cash deal. This marks Berkshire’s largest deal since the $12 billion Alleghany purchase in 2022. The deal is a clear win-win: Berkshire gains a steady, cash-generating business at attractive terms, while Occidental uses the proceeds to cut debt by $6.5 billion, strengthening its balance sheet in a challenging energy environment.

Buffett’s long-standing ties with Occidental add depth to this move—Berkshire owns around 28-30% of the oil company and previously helped finance Occidental’s Anadarko takeover in 2019. The acquisition solidifies Berkshire’s foothold in the energy and chemicals sector while allowing Occidental to focus on debt reduction and shareholder returns.

As Buffett prepares to hand over the reins to Greg Abel later this year, this deal embodies his signature value investing approach: predictable, durable businesses over flashier, high-growth bets. Whether or not it’s his final deal, Buffett’s OxyChem acquisition underscores a legacy grounded in patience, pragmatism, and long-term vision.

🤖 AI Tools Spotlight

ChatGPT Pulse: The AI That Researches While You Sleep

What The Tool Does?: OpenAI’s ChatGPT Pulse, launched recently, transforms the AI tool into a proactive assistant that delivers personalized morning updates tailored to your daily life and goals. Available initially to Pro users on mobile, Pulse works overnight to curate a focused set of insights, reminders, and next steps based on your past chats, memories, feedback, and optional integrations with Gmail and Google Calendar.

Key Features: Once a day, Pulse puts together a personalized morning briefing based on information you’ve shared through your chats, saved memories, and calendar events. It presents 5 to 10 easy-to-scan visual “cards” with helpful follow-ups, practical tips like quick dinner ideas or meeting reminders, and suggestions to support your goals such as fitness or travel plans.

Why It Matters?: ChatGPT Pulse is a leap toward making advanced AI support as accessible as a morning routine. It saves you time, enhances organization, and helps make better decisions with AI silently managing complex tasks behind the scenes. By shifting ChatGPT from a reactive Q&A bot to a proactive personal assistant, OpenAI aims to democratize high-level productivity tools, initially targeting paying Pro users and soon expanding more broadly.

Explore more about the tool here.

💭 Dealmaker’s Quote

“Successful investing is anticipating the anticipations of others.”

— John Maynard Keynes

🏢 About Us

KSMC is a Toronto-based boutique advisory firm founded by Big 4 alumni turned entrepreneur. We provide comprehensive M&A Advisory Services, strategic CFO Consulting, and tailored Accounting Solutions. Our expertise and network spans the complete transaction lifecycle—from financial due diligence (QoE reviews) and business valuations to full sell-side mandates—serving middle-market clients across industries in Canada, U.S., UAE, India, Puerto Rico, and Botswana.

Know more and reach out to us here.

Disclaimer: This newsletter is provided for informational purposes only and does not constitute any form of advice. We do not have any sponsorship, affiliate, or commercial arrangements with any companies, tools, or services mentioned in this newsletter. All examples and case studies are based on publicly available information and are included for educational purposes only.