Virtual data rooms haven’t completely eliminated the need for an in-person visit to the target company. Even in a virtual world, management presentations are still done in person.
"The human element is important in these transactions—the opportunity to ask questions, look at management straight in the eye, and report back," says Mark Greene, Cravath, Swaine & Moore’s International Practice lead.
Once the winning bidder is chosen, many deals go back online. Virtual deal rooms go beyond the virtual data room function and include a host of tools specifically designed for transaction closings by providing a virtual collaboration space for use by a deal’s legal advisors to draft, exchange, negotiate and edit versions of transaction documentation.