Completed transaction activity picked up in the fourth quarter, after a notably fallow 3Q. Data from over 200 private equity groups and other deal sponsors reported 62 completed 4Q transactions of $10-250 million TEV and TEV/Adjusted EBITDA multiples of 3-15x. This is markedly ahead of 39 closed deals in 3Q, and nearly on par with 65 in the fourth quarter of 2014. While deal volume increased in the fourth quarter, the average valuation dipped to 6.5x.
Annual data has a way of smoothing out blips in the interim periods. In the end, 2015 looked a lot like 2014. Completed deal volume: 218 in 2015 compared to 211 in ’14. Overall valuation multiples: 6.7x in both years. However, a closer look at the data reveals a number of shifts that may or may not be signs of age in this “seller’s market.”
Download Market Report Here: Market Report Spring 2016.