What do they think of the Index?
- Professor Reiner Braun, Technical University of Munich (March 2020)
- Éric de Montgolfier, CEO of Invest Europe (Dec. 2019)
Data Publication
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Quarterly Edition, Q3 2021_____________________
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Argos Index® mid-market
Evolution of Euro Zone Mid-Market Private Company Prices - Quarterly Index carried out by Epsilon Research
Consolidation of the Argos Index® at 11.0x EBITDA in Q3 2021
Acquisition prices of unlisted European SMEs have declined but remain high, at 11.0x EBITDA.
Paris (France) – 18 November 2021 – Argos Wityu, an independent European investment fund, and Epsilon Research, the online platform for the management of unlisted M&A transactions, today published the Mid-market Argos Index® for the third quarter of 2021. 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.
After a series of record highs over the last three quarters, the Argos Index® declined to 11.0x EBITDA in the third quarter of 2021, but remained at an historically high level. This decline came about because:
- Multiples paid by investment funds contracted.
- The proportion of transactions in the highly-valued healthcare and technology sectors returned to less than 40% in the third quarter of 2021, where they were before the Covid crisis.
- Macroeconomic conditions are favourable: more rapid and robust economic recovery, tied to successful vaccination in Europe and massive support for the economy.
The multiples paid by investment funds have contracted.
- The multiples paid by investment funds declined to 11.3x EBITDA after reaching record highs in the three previous quarters.
- This decline was linked to the decline in the proportion of healthcare and technology sector transactions.
- Prices paid remained high, however, and slightly higher than those paid by industry players.
- They are supported by exceptional financing conditions, an abundance of capital looking for investments and by stiff competition on high-quality assets.
Stable proportion of transactions at multiples in excess of 15x EBITDA.
- The share of transactions carried out at multiples higher than 15x EBITDA remained high in the third quarter, at one-fourth of analysed transactions.
Listed companies were very active.
- The multiples paid by strategic buyers remained high in the third quarter, at 10.9x EBITDA, driven by the large listed companies. They represented 78% of strategic buyers this quarter, the highest since the Argos index was created.
- They benefited from the continued rise in the equity markets and from their own high multiples.
- In addition to favourable economic and financing conditions, their M&A activity was driven by structural changes, prompting them to make strategic acquisitions.
M&A activity in the eurozone’s mid-market segment was mixed.
- Compared with the previous quarter, mid-market M&A activity stabilised in volume but declined in value terms.
- Recovery in the European mid-market is trailing that of its US counterpart as well as that of European large caps. Transactions have been more complex because the situation created by the Covid crisis is atypical and unstable, and the rapid recovery has made it hard to set prices.
- The average size of mid-market transactions remained high in the third quarter, at around €120 million.
> You can download the press release under "Data Publication" (left)
Argos Mid Market Index - Sample Analysis
| H1 2018 | H2 2018 | H1 2019 | H2 2019 | H1 2020 | H2 2020 | H1 2021 | Q3 2021 | |||||||||||||||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Sample Size | ||||||||||||||||||||||||||||||||||||
| # deals retained for the index | 92 | 105 | 100 | 101 | 60 | 70 | 87 | 98 | ||||||||||||||||||||||||||||
| Average Equity Value (€m) | 142.0 | 115.7 | 112.6 | 123.4 | 117.7 | 143.6 | 165.0 | 156.7 | ||||||||||||||||||||||||||||
| Average N-1 sales (€m) | 130.0 | 112.0 | 124.4 | 112.0 | 89.7 | 100.1 | 112.9 | 112.4 | ||||||||||||||||||||||||||||
| N-1 EBITDA margin | 13% | 15% | 13% | 15% | 19% | 17% | 16% | 17% | ||||||||||||||||||||||||||||
| N-1 EBIT margin | 8% | 8% | 9% | 12% | 10% | |||||||||||||||||||||||||||||||
| Breakdown by size (equity value) | ||||||||||||||||||||||||||||||||||||
| [15-49] €m | 28% | 36% | 31% | 37% | 35% | 29% | 23% | 26% | ||||||||||||||||||||||||||||
| [50-99] €m | 21% | 20% | 24% | 27% | 25% | 16% | 15% | 20% | ||||||||||||||||||||||||||||
| [100-150] €m | 16% | 18% | 19% | 6% | 13% | 20% | 14% | 12% | ||||||||||||||||||||||||||||
| Breakdown by deal type | ||||||||||||||||||||||||||||||||||||
| Acquisition | 74% | 71% | 65% | 73% | 65% | 66% | 60% | 50% | ||||||||||||||||||||||||||||
| LBO | 26% | 29% | 35% | 27% | 35% | 34% | 40% | 50% | ||||||||||||||||||||||||||||
| Breakdown by country | ||||||||||||||||||||||||||||||||||||
| France | 32% | 34% | 49% | 46% | 48% | 33% | 48% | 42% | ||||||||||||||||||||||||||||
| Germany | 15% | 20% | 14% | 14% | 17% | 20% | 12% | 10% | ||||||||||||||||||||||||||||
| Italy | 14% | 15% | 13% | 10% | 8% | 9% | 7% | 22% | ||||||||||||||||||||||||||||
| Benelux | 13% | 15% | 10% | 14% | 8% | 13% | 15% | 11% | ||||||||||||||||||||||||||||
| Spain | 4% | 6% | 3% | 5% | 7% | 11% | 5% | 4% | ||||||||||||||||||||||||||||
| Other (euro zone) | 22% | 10% | 11% | 11% | 12% | 14% | 13% | 11% | ||||||||||||||||||||||||||||
| Breakdown by sector | ||||||||||||||||||||||||||||||||||||
| Energy and Raw Materials | 11% | 5% | 2% | 11% | 9% | 7% | 6% | 6% | ||||||||||||||||||||||||||||
| Building, Construction | 3% | 5% | 6% | 2% | 0% | 0% | 3% | 3% | ||||||||||||||||||||||||||||
| Industrial Equipment | 19% | 23% | 12% | 11% | 4% | 8% | 11% | 12% | ||||||||||||||||||||||||||||
| Consumer Products | 3% | 4% | 3% | 1% | 6% | 3% | 5% | 8% | ||||||||||||||||||||||||||||
| Agro-Food | 9% | 6% | 7% | 10% | 4% | 1% | 8% | 7% | ||||||||||||||||||||||||||||
| Healthcare-Pharmaceuticals | 4% | 8% | 12% | 8% | 12% | 27% | 18% | 13% | ||||||||||||||||||||||||||||
| Wholesale, Retail | 9% | 5% | 7% | 8% | 4% | 4% | 3% | 7% | ||||||||||||||||||||||||||||
| Transport | 11% | 7% | 7% | 6% | 6% | 3% | 5% | 6% | ||||||||||||||||||||||||||||
| TMT | 21% | 23% | 22% | 29% | 39% | 38% | 27% | 26% | ||||||||||||||||||||||||||||
| Business and Consumer Services | 10% | 14% | 22% | 14% | 16% | 9% | 14% | 12% | ||||||||||||||||||||||||||||
Argos Mid Market Index - List of Underlying Transactions
H1 2004 - H2 2004 - H1 2005 - H2 2005 - H1 2006 - H2 2006 - H1 2007 - H2 2007 - H1 2008 - H2 2008 - H1 2009 - H2 2009 - H1 2010 - H2 2010 - H1 2011 - H2 2011 - H1 2012 - H2 2012 - H1 2013 - H2 2013 - H1 2014 - H2 2014 - H1 2015 - H2 2015 - H1 2016 - H2 2016 - H1 2017 - H2 2017 - H1 2018 - H2 2018 - H1 2019 - H2 2019 - H1 2020 - H2 2020 - H1 2021 - Q3 2021
| Date | Acquirer | Target | Country | Industries | Valuation multiples | See details |
|---|---|---|---|---|---|---|
| 18/08/2021 | WHP Global | Lotto Sport Italia (LSI) Brand | Italy | Sportswear | ** | 106298 |
| 10/08/2021 | Extreme Networks | Ipanema Technologies (Ipanematech) | Hauts-De-Seine | Telecom infrastructure Softwares | ** | 106318 |
| 09/08/2021 | Halma | Sensitron | Italy | Electronic Security Systems | ** | 105959 |
| 05/08/2021 | Focus Home Interactive | DotEmu | Paris | Videogames | ** | 105983 |
| 02/08/2021 | Volution Group | Energy Recovery Industries Corp | Italy | Heating, Ventilation and Air-Conditioning (HVAC) | ** | 105897 |
| 29/07/2021 | Securitas | Protection One | Germany | Security Services | ** | 105964 |
| 23/07/2021 | Private Group led by 21 Invest France | Woonoz (Projet Voltaire) | Rhône | Education / Learning software, Artificial Intelligence (AI) | * | 106037 |
| 15/07/2021 | Enea | Adaptive Mobile Security | Ireland | Security Software | ** | 106304 |
| 13/07/2021 | Private Group led by Andera Partners and Bpifrance | MC2 Technologies (Microwave Characterization Center) | Nord | Electronic Security Systems, Electronic Security Systems | * | 106030 |
| 12/07/2021 | Private Group backed by Crédit Mutuel Equity | La Foir'fouille | Hérault | Home Improvement R&W | * | 106481 |
| 08/07/2021 | Private Group led by Sagard | Ginger | Yvelines | Health, Safety, and Environmental Consulting | * | 106519 |
| 22/06/2021 | Grafton Group | Isojoen Konehalli & Jokapaikka Oy | Finland | Agricultural & Construction Equipment, Industrial Components Distributors | ** | 105521 |
| 21/06/2021 | Ingersoll Rand | Seepex | Germany | Pumps & PVF | ** | 105470 |
| 21/06/2021 | Private Group led by August Equity LLP | Integrity Communications (Integrity360) | Ireland | Security Software | * | 106286 |
| 17/06/2021 | Kadant | Joh Clouth | Germany | Industrial Components | ** | 105494 |
| 16/06/2021 | Oxford Instruments | WITec Wissenschaftliche Instrumente und Technologie | Germany | Electronic Equipment (for corporates) | * | 105507 |
| 11/06/2021 | Element Solutions | Coventya | Hauts-De-Seine | Specialty Chemicals | *** | 105258 |
| 01/06/2021 | Take-Two Interactive Software (T2) | Nordeus | Ireland | Videogames | ** | 105446 |
| 19/05/2021 | Cellink | Nanoscribe | Germany | Medical Equipment | ** | 105542 |
| 18/05/2021 | Private Group led by Amundi Private Equity Funds | The Reefer Group S.L (TRG) | Spain | Commercial Vehicles, Trucks & Buses, Special Purpose Vehicles & Equipment | * | 106369 |
| 17/05/2021 | Private Group led by Universities Superannuation Scheme | Bruc Energy | Spain | Investment Holding, Solar Producer / Generator | * | 106525 |
| 10/05/2021 | Mycronic | atg Luther & Maelzer | Germany | Measurement & Test Equipment, Equipement for Test & Measuring | *** | 105253 |
| 06/05/2021 | Private Group led by Bpifrance, NCI Gestion and BNP Paribas Développement | Groupe Pommier | Val-D'Oise | Exterior Parts | * | 106350 |
| 04/05/2021 | Victoria | Edel Group | Netherlands | Furnishings | *** | 104814 |
| 03/05/2021 | Private Group led by Abénex | HTDS (Hi-Tech Detection Systems) | Essonne | Electronic Security Systems, Electronic Security Systems | *** | 106444 |
| 28/04/2021 | Brembo | J Juan | Spain | Drivetrain | *** | 105091 |
| 27/04/2021 | Lime Technologies | Userlike UG | Germany | Software as a Service (SAAS), Customer Relationship Management (CRM) | *** | 104829 |
| 23/04/2021 | Private Group led by Naxicap Partners | Lagarrigue | Haute-Garonne | Medical Implants or Prostheses Manufacturers | * | 105539 |
| 19/04/2021 | JBS | Vivera | Netherlands | Canned, Frozen and Cooked Food | ** | 105162 |
Argos Mid-Market Index Breakdown
Access restricted to "Epsilon Eurozone Data" subscribers.
> If you are a subscriber, please login on the Epsilon Platform
> If not, please click here for additional information
NB: This part includes the transaction multiples (median, LTM):
I- Breakdown per main industry sectors
- Energy, Raw Materials, and Chemicals
- Building - Construction
- Industrial Equipment
- Consumer Products
- Agro-food
- Healthcare - Pharma
- Wholesale - Retail
- Transport
- TMT (Technology, Media, Telecommunications)
- Business and Consumer Services
II- Breakdown per main Euro Zone countries
- Germany
- France
- Italy
- Spain - Portugal
- Benelux
Euro Zone Mid Market M&A Trends
Access restricted to "Epsilon Eurozone Data" subscribers.
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> If not, please click here for additional information
NB: This part includes the following data:
- Euro zone M&A mid market activity (volume & value)
- Share of foreign buyers within industrial buyers
- Breakdown of foreign buyers (Europe -non Euro zone, North America, Asia, RoW)
- Share of listed buyers within industrial buyers
Euro Zone Mid Market LBO Trends
Access restricted to "Epsilon Eurozone Data" subscribers.
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NB: This part includes the following data:
- Euro zone LBO mid market activity (volume & value)
- Euro zone LBO exit mid market activity (volume & value)
- Share of SBOs within LBO exits
Argos Mid Market Index - Methodology
The Argos Mid-Market Index measures the evolution of euro zone private mid market company valuations.
Carried out by Epsilon Research for Argos Soditic and published every quarter, it reflects median EV/EBITDA multiples, on a six-month rolling basis, of mid market M&A transactions in the euro zone.
The preparation of the Argos Mid-Market Index is based on a rigorous methodology and in-depth scrutiny of M&A transactions making up the sample :
- Choice of the relevant multiple: the EV/EBITDA multiple is the most suitable for a European index as it is not impacted by the target’s financial structure nor by its policies regarding depreciation and provisioning (which vary in time and between countries). It is also the closest readily available proxy for operating cash flow.
- Sample of M&A transactions analysed, using the following criteria :
- acquisition of a majority stake,
- target based in a euro zone country,
- mid market : equity value in the €15-500m range (€15-150m up to H1 2013; €15-500m from H2 2013 onwards),
- certain activities excluded (financial services, real estate, high-tech),
- availability of relevant target financial data.
- Information sources are those used by Epsilon Research to prepare analysis reports on transactions available in its EMAT database:
- Professional partner databases such as: CorpfinDeals (transactions), CompanyQuery (company accounts),
- Publicly available information: company accounts, press releases, annual reports (buyers / sellers), press articles, etc.
- Comprehensive analysis of each transaction identified: research covering all available information; verifying, cross-checking, restating financial data; analysis of target activity and of the context of the deal; calculating and analysing acquisition multiples; rating the reliability of multiples.
The Index in perspective:
Following its launch in December 2006, the Argos Mid-Market Index has become a leading reference for private transactions, used by private equity funds, M&A advisors, investment banks, and accountants.
The strict methodology followed guarantees that the index is rigorous, relevant, stable and transparent. The goal is to offer market professionals and company managers a reference tool for understanding the evolution of acquisition prices in private company transactions.
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The Index is only an indication of the evolution of private company prices. It is relevant in relative, not absolute, value. The Index was not designed as a business valuation tool and cannot be used directly to value a company. |
In partnership with
“The Argos Index® is an important benchmark for valuing unlisted European companies and is based on very reliable data", Éric de Montgolfier, CEO of Invest Europe (See his interview)
Index source of information:
EMAT - Epsilon Multiple Analysis Tool™
The Reference Source for Private Company Acquisition Multiples
