Content
- Significant drop in the Argos Index® to 9.3x EBITDA
- Interview with Professor Reiner Braun, Chair of Entrepreneurial Finance at the TUM School of Management, Technical University of Munich
- Prices paid by strategic players fell to 10.0x EBITDA; prices paid by investment funds remained lower, at 8.8x EBITDA.
- Decrease in the share of transactions at high multiples to usual levels
- Drop in multiples of listed companies
- Rebound in European mid-market M&A activity in Q1 2020… before a drop to be observed in Q2 2020
- Increased weighting of Germany in the 1st quarter of 2020 in the Eurozone mid-market M&A activity
Principal conclusions
- Significant drop in the Argos Index® to 9.3x EBITDA, beginning in January 2020 and intensifying in March
- Investment funds remained more prudent (8.8x) than trade buyers (10.0x)y
- 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
- Germany most active Euro zone region in terms of SME deal involvement, followed by Benelux and France
Chair of Entrepreneurial Finance at the TUM School of Management, Technical University of Munich
Professor Reiner Braun
“The Argos Index® sheds light on a market sector that is notoriously opaque and under-researched, with a lot of potential to be unlocked”
Median EV/EBITDA multiple on a six-month rolling basis
Source: Mid-market Argos Index® / Epsilon Research
All on the Argos Index ®
MANAGING PARTNER
Louis Godron
“The Argos Index® was born out of the desire to create a database for the unlisted market that would be both methodologically robust and rich in high-quality information. Robustness is the index’s salient characteristic.”
MANAGING PARTNER
Frank Hermann
“When the CEO of a company wonders if now is the right time to sell, the Argos Index® supplies essential business cycle information and helps him or her make a decision. The Argos Index® derives its legitimacy from its longevity and independence.”
FOUNDER, EPSILON RESEARCH
Grégoire Buisson
“If the Argos Index® is now a benchmark in Europe, it’s because we use information from our EMAT (Epsilon Multiple Analysis Tool) database that has been proven to be reliable. The index has always been based on this methodology. We work meticulously, transaction by transaction, examining documents, analyzing annual reports, reconstituting transactions and building hypotheses.”