By: Paul Hawkins
On November 16, 2020, the SBA’s long-awaited Final Rule (the “Rule”) amending various small business regulations across a wide variety of areas went into effect. One area of significant change is in the area of size and socioeconomic status recertification. Recertification is an area of immense importance to government contractors engaged in or contemplating merger and acquisition (“M&A”) activity. Whether or not set-aside contracts critical to a small business’s portfolio will still be able to generate revenue at predictable levels post-M&A can materially affect the valuation of a small business government contractor. Before discussing these changes and their potential impact, it is important to understand the background.