While concerns over COVID-19 began to rise in early March, many sponsors and sellers paused deals to evaluate the environment and assess how businesses would be affected. As operations return to a new type of normal, many investors are pressing play on those transactions that were in progress prior to the pandemic.
With a perceptible recent increase in transaction activity, it is evident that both buyers and sellers can easily adapt to any economic climate. Once the rules of the game are established, and the tools to find, diligence, finance, and close deals are identified, they will begin to play.
Although there continues to be an increase in activity, one common theme we are seeing is that deals are taking longer to close. We recommend being mindful of the following:
- Scrutiny by buyers to ensure they understand what they are buying.
- Reliance on third-parties to perform enhanced diligence, with a particular focus on supply chains.
- Computing the impact of COVID-19 and potential future risks.
- Unsteady credit availability.
- Varying expectations between buyer and seller.
Many questions still remain about the pandemic’s impact on business valuations and the M&A market. CBIZ CMF’s Managing Director, Seth Goldblum, discussed these concerns with other industry leaders during our M&A panel, Looking Forward - Deal Making and Business Values. Click here to listen to our panel of experts share their insights on what they see for the balance of 2020.
In the meantime, if you’re considering pressing play, CBIZ CMF is here to help generate high fidelity.
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