2019 Midyear M&A Transaction Update: Middle Market ($10M - $250M)

Hi, my name is Adam McArthur. I am a partner with Weaver in their financial advisory services practice.

As we approach the midpoint of 2019, I have a quick update on middle market private equity market transactions. We have focused on transactions with enterprise values ranging from 10 million to 250 million dollars.  Before I delve into the details, I should thank our friends at GF Data® for compiling this information. This data is based on more than 200 North American private equity firms that contribute to GF Data® on a blind and anonymous basis.

During the first quarter of 2019, there were 57 reported transactions which took place at an average adjusted EBITDA multiple of 6.9 times. That’s slightly lower than the number of transactions in the fourth quarter of 2018, which saw 63 transactions. Valuations are down almost a full turn since then, when the adjusted EBITDA multiples averaged 7.8 times.

As we usually see, the larger transactions tended to take place at higher multiples. The lower bracket of transactions — those in the 10 to 25 million-dollar range — had an average EBITDA multiple of 5.8 times. The largest grouping— transactions in the 100 to 250 million-dollar range— took place at an average multiple of 9.2 times EBITDA.

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