Mid-market Argos Index® Q2 2019

 Acquisition prices of unlisted European SMEs remain stable at a historic high (10.0x EBITDA)

• M&A activity in Europe slows in the 1st half of 2019

Paris (France), 24 July 2019 – Argos Wityu, the European independent private equity group, and Epsilon Research, the online platform for the management of unlisted M&A transactions, today published the mid-market Argos Index® for the 2nd quarter of 2019. This index, launched in 2006, measures changes in the valuations of Eurozone private mid-market companies in which a majority stake has been acquired during the last six months.

In the 2nd quarter of 2019 the mid-market Argos Index® remained stable at a historic high of 10.0x EBITDA.

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

However, this stability conceals three differences:
  • Multiples paid by strategic buyers fell slightly to 10.3x EBITDA, while multiples paid by private equity funds remained relatively stable (9.5x EBITDA in the 2nd quarter).
  • These multiples contrast with those for listed mid-market companies, despite their 2nd-quarter increase to 8.8x EBITDA(1), in line with the growth of listed market indexes(2).
  • Valuation multiples for transactions between €150m and €500m continued to rise during the quarter, while transactions between €15m and €150m declined.

(1) Source: InFront Analytics
(2) The EURO STOXX® TMI Small Index rose by 1.7% in Q2 2019

M&A activity in Europe slows in the 1st half of 2019
In the first half of 2019, mid-market M&A activity showed a moderate 20% decline in value in the Eurozone, while the same segment fell 48% in the United Kingdom, due to the lack of visibility as to the terms of Brexit, scheduled for the end of the year, and total M&A activity, all segments combined, dropped 57% in Europe.

Argos Wityu

Coralie Cornet
Head of Communications
ccc@argos.fund
+33 6 14 38 33 37

About Argos Wityu / www.argos.wityu.fund
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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