Despite many elevated risks, Veritext is still successfully buying businesses through the pandemic.  There are a range of ways that COVID has impacted our view of acquisitions and the acquisition process.  However, when we value a business today, it’s not based on what happened in 2020, but what we think will happen in 2021 and beyond.  We know that business owners have choices and that just because this was an unusual year where most businesses, particularly in our industry, experienced below normal volumes for a good part of the year, it doesn’t mean your business is worth half of what it was.

There is additional risk today given the limited ability to perform in-person depositions, impact on civil jury trials, and the possibility of subsequent governmental restrictions on business activity, which has implications for business valuation.  However, we look at the financial performance before, during, and after the pandemic’s impact, and if your business has returned to pre-pandemic levels, then the valuation should approximate what it would have been had you sold in 2019.

As far as the acquisition process itself, we generally perform most of the work remotely so that part is relatively less impacted.  We do like to have face-to-face meetings to get to know the owners and their business better, and that part has been more challenging.  And the first few weeks post-closing are usually a time where we spend face-to-face time with staff, reporters, and clients, which has been more challenging as of late.  All that said, we will continue to make quality acquisitions and have adjusted our approach to ensure that we adhere to best practices with respect to social distancing and keeping our people and prospective staff healthy.  With remote technology, frequent communication, and developing trust between Veritext and the Seller, we have confidence that we will continue to successfully acquire and integrate great reporting firms and their staff into the Veritext family.