Seyfarth Shaw Corporate partner Robert Bodansky wrote an article published in the Washington Business Journal on September 27. The article discussed indefinite delivery/indefinite quantity (IDIQ) government contracts, which can affect a company's potential value at the time of sale.
Bob points out that one of the first questions that a buyer asks a government contractor is what percentage of the target's contracts are IDIQ contracts, and if that number is high, buyers and sellers often disagree about how to estimate the company's revenue and value.
Bob recommends to companies that they need to either show consistency under IDIQ contracts or discount them from the total proposed value.
Click here to read the full article: http://www.bizjournals.com/washington/blog/fedbiz_daily/2011/09/the-impact-of-idiq-contracts-on.html