Argos Mid-market Index® Q1 2020

Acquisition prices of unlisted SMEs declined to 9.3x EBITDA

Fewer transactions where high multiples of >15x EBITDA are paid

Rebound in European mid-market M&A volume activity in Q1 2020… before an obvious drop to be observed in Q2 2020

Paris (France) – 12 May 2020 – Argos Wityu, an independent European investment fund, and Epson Research, the online platform for the management of unlisted M&A transactions, today published the Argos Mid-market Index® for the first quarter of 2020. This index, launched in 2006, tracks the valuations of eurozone private, mid-market companies in which a majority stake has been acquired during the last six months.

Prices paid to acquire unlisted European SMEs declined significantly to 9.3x EBITDA, after having reached a record high of 10.3x EBITDA in the previous quarter.
Argos Index - Argos Wityu

Multiple median EV/EBITDA, 6-mo. rolling basis – Source: Mid-market Argos Index® / Epsilon Research

  • The Argos Index®’s decline to 9.3x EBITDA began in January and accelerated in March.
  • For the most part, this decline reflected the market’s anticipation of a downturn in the economy at the beginning of the year. As the Argos Index®is calculated on a six-month rolling basis, the impact of the Covid-19 crisis was limited at this stage, even though disruptions related to the epidemic started to be felt at the end of January.
Multiples paid by corporate buyers declined to 10.0x EBITDA.
  • This represents a 6.5% decline over the quarter.
  • They remained higher than prices paid by investment funds, which averaged 8.8x EBITDA and were down 12% over the quarter. Buyout volumes have been down since the third quarter of 2019. Funds continued to build up their level of dry powder .
Transactions at high multiples, in excess of 15x EBITDA, were down.
  • They represented 12% of the transactions carried out during the quarter.
  • This level is in line with those recorded in 2018 and in the first half of 2019.
The multiples of listed, eurozone, mid-market companies fell sharply.
  • Over the quarter, they were down 21%, at 6.8x EBITDA2, in line with the trend in equity markets3.
    Note: Stock market multiples were calculated on the basis of spot prices at March 31, which integrated the impact of the Covid-19 crisis. Care should be taken when comparing them to the Argos Index®, which is computed on the 6 months before.
Rebound in European mid-market M&A volume activity in Q1 2020… before an obvious drop to be observed in Q2 2020..
  • Transactions during the quarter increased by 15% in volume terms.
  • Relatively unaffected by the Covid-19 crisis until mid-March, they returned to their year-earlier level.
  • Germany most active Euro zone region in terms of SME deal involvement, followed by Benelux and France

1 According to Preqin, the global private equity sector had dry powder of $1.45tn as of 31 December 2019.
2 Source:
3 The EuroStoxx® TMI Small index fell 26.1% between 1 January and 31 March 2020.

Argos Wityu

Coralie Cornet
Head of Communications
+33 6 14 38 33 37

About Argos Wityu /
Argos Wityu is an independent European investment fund that supports companies in the transfer of business ownership. It has assisted more than 80 entrepreneurs, focusing its investment strategy on complex transactions with emphasis on transformation, growth, and close collaboration with management teams. Argos Wityu seeks to acquire majority interests and invest between €10m and €100m with each transaction. With more than €1bn under management and 30 years of experience, Argos Wityu operates from offices in Brussels, Frankfurt, Geneva, Luxembourg, Milan and Paris.

Epsilon Research developed the first online platform for the management of non-quoted M&A transactions, aimed at M&A professionals. The Epsilon platform includes data, analysis reports, software and services essential for private company valuation / deal management: EMAT, the largest database of European private company transaction multiples, with detailed analysis of 8,000 M&A deals, ranging from €1m to €500m in value, covering all industry sectors; indices and studies published regularly by Epsilon, including the Argos Index; cloud-based software for managing M&A contacts and projects; valuation of comparable private equity fund investments.

The Mid-market Argos Index® tracks the valuation of unlisted mid-market companies in the eurozone. Carried out by Argos Wityu and Epsilon Research and published every three months, it reflects median EV/EBITDA multiples, on a six-month rolling basis, of transactions meeting the following criteria: mid-market (equity value between €15m and €500m for 100%), target based in a eurozone country, acquisition of a majority stake, certain activities excluded (financial services, real estate, high-tech).

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