If you need the latest transaction multiples being paid for UK private companies, take a look at BVB Insights: Data and Analysis on UK Private Company Multiples, 2016 Edition. The report has this information broken down into 11 industry sectors and, where appropriate, 38 industry subsectors for the year ended December 2015.
Highest and lowest: The highest EBITDA multiples paid were in the consumer staples (11.3x), healthcare (11.0x), and energy (15.1x) sectors, according to the guide. Consumer discretionary, financials (excluding banks), and IT sectors also transacted at high multiples on average—9.1x, 9.4x and 8.7x, respectively. All these sectors had, on average, the highest margins among the industry groups. High multiples in the consumer staples industry were largely due to branded food manufacturers. The IT sector saw high multiples in application software, an industry poised for solid growth over the next few years. Consumer discretionary further continued its strong average EBITDA multiples, largely driven by local and foreign private equity acquiring strong branded companies, continued consolidation in the advertising and marketing sector, and leisure businesses that are forecast to grow due to increased consumer confidence and disposable income.
The lowest multiples were paid in the industrials (7.9x), industrials—services (6.9x), and utilities (7.8x) sectors. The lower multiples were largely due to the targets in these industry categories being the smallest and having relatively lower margins among the industry categories.
The 176-page guide, compiled by Business Valuation Benchmarks Ltd., is available from BVR. For details and how to order, click here.
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