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- 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, Q2 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
The Argos Index® continued to rise, to 11.6x EBITDA, a new all-time high
Acquisition prices of unlisted European SMEs continued to rise, reaching a new record high of 11.6x EBITDA, still supported by the prices paid by investment funds.
Paris (France) – 22 July 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 second 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.
At 11.6x EBITDA, the Argos Index® stood at a new record high for the third consecutive quarter. This steady rise came about because:
• The multiples paid by investment funds continued to rise;
• Transactions in the healthcare and technology sectors continued to account for 50% of those realised in the second quarter and were concluded at higher multiples than those of other sectors;
• Macroeconomic conditions are favourable: the economic recovery, tied to increased vaccination in Europe, has been robust and rapid; governments, the European Union and the ECB have provided massive support to the economy.
Multiples paid by investment funds reached a new high.
• Multiples reached a new record high of 12.9x EBITDA, exceeding the highs of the two previous quarters and further widening the spread with multiples paid by strategic buyers, which stood at 10.7x EBITDA.
• Four factors are driving this increase: i) rapid economic recovery, (ii) a record-high level of private-equity investment, iii) the low cost of acquisition debt, and (iv) stiff competition from strategic buyers on companies unaffected by the crisis.
• As in the first quarter, funds showed more homogeneity than strategic buyers, in terms of both prices paid (standard deviation of 33% vs 48%) and the profiles of the companies acquired (high-quality companies relatively unaffected by the crisis).
Sharp first-half rise in number of transactions with multiples in excess of 15x EBITDA.
• The share of transactions with multiples higher than 15x EBITDA rose again in H1 2021, to nearly one-fourth of analysed transactions.
Listed companies were particularly active during the first half.
• They represented 80% of strategic buyers in the first half, the highest since the Argos index was created in 2004.
• They benefited from the continued rise in equity markets.
The eurozone’s mid-market M&A segment bounced back.
• Compared with the previous quarter, the value of transactions increased by 18% and the number of transactions by 7%.
• In value terms, while the market returned to its 2019 level in the first half, transaction volume remained one-third lower.
The Benelux was the eurozone region in which M&A activity increased the most.
• In the first half, the M&A market recovered more in northern European countries, in particular Benelux, where the Covid-19 crisis was less disruptive than in southern Europe.
• As such, Germany and Benelux represented 25% and 22% of European mid-cap M&A market volume, respectively.
> You can download the press release under "Data Publication" (left)
Argos Mid Market Index - Sample Analysis
| H2 2017 | H1 2018 | H2 2018 | H1 2019 | H2 2019 | H1 2020 | H2 2020 | H1 2021 | ||||||||||||||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Sample Size | |||||||||||||||||||||||||||||||||||
| # deals retained for the index | 89 | 92 | 105 | 100 | 101 | 60 | 70 | 87 | |||||||||||||||||||||||||||
| Average Equity Value (€m) | 140.5 | 142.0 | 115.7 | 112.6 | 123.4 | 117.7 | 143.6 | 165.0 | |||||||||||||||||||||||||||
| Average N-1 sales (€m) | 113.3 | 130.0 | 112.0 | 124.4 | 112.0 | 89.7 | 100.1 | 112.9 | |||||||||||||||||||||||||||
| N-1 EBITDA margin | 14% | 13% | 15% | 13% | 15% | 19% | 17% | 16% | |||||||||||||||||||||||||||
| N-1 EBIT margin | 12% | 8% | 8% | 9% | 12% | 10% | |||||||||||||||||||||||||||||
| Breakdown by size (equity value) | |||||||||||||||||||||||||||||||||||
| [15-49] €m | 25% | 28% | 36% | 31% | 37% | 35% | 29% | 23% | |||||||||||||||||||||||||||
| [50-99] €m | 18% | 21% | 20% | 24% | 27% | 25% | 16% | 15% | |||||||||||||||||||||||||||
| [100-150] €m | 22% | 16% | 18% | 19% | 6% | 13% | 20% | 14% | |||||||||||||||||||||||||||
| Breakdown by deal type | |||||||||||||||||||||||||||||||||||
| Acquisition | 67% | 74% | 71% | 65% | 73% | 65% | 66% | 60% | |||||||||||||||||||||||||||
| LBO | 33% | 26% | 29% | 35% | 27% | 35% | 34% | 40% | |||||||||||||||||||||||||||
| Breakdown by country | |||||||||||||||||||||||||||||||||||
| France | 28% | 32% | 34% | 49% | 46% | 48% | 33% | 48% | |||||||||||||||||||||||||||
| Germany | 13% | 15% | 20% | 14% | 14% | 17% | 20% | 12% | |||||||||||||||||||||||||||
| Italy | 19% | 14% | 15% | 13% | 10% | 8% | 9% | 7% | |||||||||||||||||||||||||||
| Benelux | 11% | 13% | 15% | 10% | 14% | 8% | 13% | 15% | |||||||||||||||||||||||||||
| Spain | 14% | 4% | 6% | 3% | 5% | 7% | 11% | 5% | |||||||||||||||||||||||||||
| Other (euro zone) | 15% | 22% | 10% | 11% | 11% | 12% | 14% | 13% | |||||||||||||||||||||||||||
| Breakdown by sector | |||||||||||||||||||||||||||||||||||
| Energy and Raw Materials | 11% | 11% | 5% | 2% | 11% | 9% | 7% | 6% | |||||||||||||||||||||||||||
| Building, Construction | 7% | 3% | 5% | 6% | 2% | 0% | 0% | 3% | |||||||||||||||||||||||||||
| Industrial Equipment | 13% | 19% | 23% | 12% | 11% | 4% | 8% | 11% | |||||||||||||||||||||||||||
| Consumer Products | 5% | 3% | 4% | 3% | 1% | 6% | 3% | 5% | |||||||||||||||||||||||||||
| Agro-Food | 8% | 9% | 6% | 7% | 10% | 4% | 1% | 8% | |||||||||||||||||||||||||||
| Healthcare-Pharmaceuticals | 6% | 4% | 8% | 12% | 8% | 12% | 27% | 18% | |||||||||||||||||||||||||||
| Wholesale, Retail | 7% | 9% | 5% | 7% | 8% | 4% | 4% | 3% | |||||||||||||||||||||||||||
| Transport | 3% | 11% | 7% | 7% | 6% | 6% | 3% | 5% | |||||||||||||||||||||||||||
| TMT | 14% | 21% | 23% | 22% | 29% | 39% | 38% | 27% | |||||||||||||||||||||||||||
| Business and Consumer Services | 26% | 10% | 14% | 22% | 14% | 16% | 9% | 14% | |||||||||||||||||||||||||||
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
| Date | Acquirer | Target | Country | Industries | Valuation multiples | See details |
|---|---|---|---|---|---|---|
| 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 |
| 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 |
| 10/05/2021 | Mycronic | atg Luther & Maelzer | Germany | Measurement & Test Equipment, Equipement for Test & Measuring | *** | 105253 |
| 04/05/2021 | Victoria | Edel Group | Netherlands | Furnishings | *** | 104814 |
| 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 |
| 19/04/2021 | JBS | Vivera | Netherlands | Canned, Frozen and Cooked Food | ** | 105162 |
| 23/03/2021 | Kingspan Group | Logstor International | Luxembourg | Pumps & PVF | ** | 104315 |
| 15/03/2021 | DCC | Wörner Medizinprodukte | Germany | Specialised R&W, Medical Supplies | * | 104383 |
| 02/03/2021 | Croda International | Alban Muller International | Eure-Et-Loir | Personal Products | * | 104406 |
| 02/03/2021 | Neenah | Global Release Liners (ITASA) | Spain | Plastic Packaging Manufacturers | ** | 104505 |
| 01/03/2021 | Hologic | Diagenode | Belgium | Diagnostic Medical Equipment | * | 104487 |
| 26/02/2021 | Datalogic | MD Micro Detectors | Italy | Electronic Equipment, Optoelectronics | *** | 104400 |
| 10/02/2021 | Tenable | Alsid | Paris | Software as a Service (SAAS), Security Software | * | 104760 |
| 28/01/2021 | Olympus | Quest Photonic Devices | Netherlands | Medical Equipment | * | 104418 |
| 11/01/2021 | Lanxess | Theseo | France | Cleaning Products - Manufacturers | ** | 104299 |
| 08/01/2021 | IDEX | ABEL Pumps | Germany | Pumps & PVF | ** | 104305 |
| 05/01/2021 | Building Materials Europe (formerly CRH Plc) | Saint-Gobain Building Distribution the Netherlands | Netherlands | Distribution of Materials & Equipment for Buildings / Public Works | *** | 103299 |
Argos Mid-Market Index Breakdown
Access restricted to "Epsilon Eurozone Data" subscribers.
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> 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
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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
