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 Ed., Q2 2022_____________________
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Argos Index® mid-market
Evolution of Euro Zone Mid-Market Private Company Prices - Quarterly Index carried out by Epsilon Research
Q2 2022: Decline of the Argos Index® to 10.0x EBITDA, back to its level of Dec. 2021
Paris (France) – 18 February 2022 – Argos Wityu, the independent European investment fund, and Epsilon Research, the online platform for the management of non-quoted M&A transactions, today published the Mid-market Argos Index® for the fourth 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.
Acquisition prices of unlisted European SMEs have corrected once again.
- In Q2 2022, the Argos Index® declined to 10.0x EBITDA, down 14% from the high a year ago and back to its level of December 2021.
- The change is attributable to a decline in volume of mid-market M&A activity, the war in Ukraine lasting longer than expected, a steep rise in inflation, rapid hikes in interest rates, and significantly slower growth in the United States and Europe.
- However, the impact of these turbulent conditions on prices and mid-market activity remains moderate compared with the impact on equity markets [1] and the global M&A market [2].
Prices paid by strategic buyers down slightly.
- In Q2, multiples paid by funds were stable, at 10.8x EBITDA, but down by 2x EBITDA from the high of Q2 2021.
- Multiples paid by strategic buyers declined slightly, to 9.9 EBITDA, and were affected by the sharp contraction in equity markets.
A growing share of transactions at multiples < 7x EBITDA.
- The share of transactions > 15x EBITDA is down significantly from 2021, as it was in Q1, and accounts for 15% of analysed transactions (i.e. the pre-Covid level).
- At the same time, the share of transactions < 7x EBITDA increased and now accounts for 20% of the sample.
Decline in European mid-market M&A activity related to fewer LBO deals.
- Mid-market M&A activity declined by 14% in volume compared with the previous quarter, but is stable in value. It has withstood the deteriorated economic and financial outlook better than the global M&A market, which fell 23% in value in Q1 compared with 2021.
- Mid-market buyout activity fell significantly in Q2: –19% in volume and –43% in value, particularly for large transactions (–30% for deals between €150m and €500m), a performance related to rapid hikes in interest rates and to lower borrowing capacity for LBO deals.
- Nonetheless, funds continue to benefit from record levels of money available for investment, and unlisted assets still enjoy strong profitability.
[1] The EURO STOXX® TMI Small declined by 19.2% in H1 2022
[2] Global M&A activity fell 23% in value and 16% in Europe compared with H1 2021 – Source: Refinitiv
> You can download the press release under "Data Publication" (left)
Argos Mid Market Index - Sample Analysis
| H1 2019 | H2 2019 | H1 2020 | H2 2020 | H1 2021 | H2 2021 | Q1 2022 | H1 2022 | |||||||||||||||||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Sample Size | ||||||||||||||||||||||||||||||||||||||
| # deals retained for the index | 100 | 101 | 60 | 70 | 87 | 92 | 100 | 107 | ||||||||||||||||||||||||||||||
| Average Equity Value (€m) | 112.6 | 123.4 | 117.7 | 143.6 | 165.0 | 133.9 | 117.6 | 109.6 | ||||||||||||||||||||||||||||||
| Average N-1 sales (€m) | 124.4 | 112.0 | 89.7 | 100.1 | 112.9 | 106.6 | 94.1 | 120.0 | ||||||||||||||||||||||||||||||
| N-1 EBITDA margin | 13% | 15% | 19% | 17% | 16% | 18% | 15% | 13% | ||||||||||||||||||||||||||||||
| N-1 EBIT margin | 9% | 12% | 10% | |||||||||||||||||||||||||||||||||||
| Breakdown by size (equity value) | ||||||||||||||||||||||||||||||||||||||
| [15-49] €m | 31% | 37% | 35% | 29% | 23% | 35% | 33% | 32% | ||||||||||||||||||||||||||||||
| [50-99] €m | 24% | 27% | 25% | 16% | 15% | 22% | 30% | 31% | ||||||||||||||||||||||||||||||
| [100-150] €m | 19% | 6% | 13% | 20% | 14% | 10% | 10% | 12% | ||||||||||||||||||||||||||||||
| Breakdown by deal type | ||||||||||||||||||||||||||||||||||||||
| Acquisition | 65% | 73% | 65% | 66% | 60% | 66% | 74% | 74% | ||||||||||||||||||||||||||||||
| LBO | 35% | 27% | 35% | 34% | 40% | 34% | 26% | 26% | ||||||||||||||||||||||||||||||
| Breakdown by country | ||||||||||||||||||||||||||||||||||||||
| France | 49% | 46% | 48% | 33% | 48% | 37% | 30% | 30% | ||||||||||||||||||||||||||||||
| Germany | 14% | 14% | 17% | 20% | 12% | 13% | 20% | 17% | ||||||||||||||||||||||||||||||
| Italy | 13% | 10% | 8% | 9% | 7% | 13% | 11% | 18% | ||||||||||||||||||||||||||||||
| Benelux | 10% | 14% | 8% | 13% | 15% | 16% | 16% | 10% | ||||||||||||||||||||||||||||||
| Spain | 3% | 5% | 7% | 11% | 5% | 9% | 6% | 5% | ||||||||||||||||||||||||||||||
| Other (euro zone) | 11% | 11% | 12% | 14% | 13% | 12% | 17% | 20% | ||||||||||||||||||||||||||||||
| Breakdown by sector | ||||||||||||||||||||||||||||||||||||||
| Energy and Raw Materials | 2% | 11% | 9% | 7% | 6% | 5% | 3% | 6% | ||||||||||||||||||||||||||||||
| Building, Construction | 6% | 2% | 0% | 0% | 3% | 7% | 5% | 4% | ||||||||||||||||||||||||||||||
| Industrial Equipment | 12% | 11% | 4% | 8% | 11% | 14% | 18% | 14% | ||||||||||||||||||||||||||||||
| Consumer Products | 3% | 1% | 6% | 3% | 5% | 9% | 7% | 7% | ||||||||||||||||||||||||||||||
| Agro-Food | 7% | 10% | 4% | 1% | 8% | 2% | 4% | 4% | ||||||||||||||||||||||||||||||
| Healthcare-Pharmaceuticals | 12% | 8% | 12% | 27% | 18% | 11% | 8% | 5% | ||||||||||||||||||||||||||||||
| Wholesale, Retail | 7% | 8% | 4% | 4% | 3% | 7% | 2% | 4% | ||||||||||||||||||||||||||||||
| Transport | 7% | 6% | 6% | 3% | 5% | 3% | 7% | 6% | ||||||||||||||||||||||||||||||
| TMT | 22% | 29% | 39% | 38% | 27% | 28% | 32% | 34% | ||||||||||||||||||||||||||||||
| Business and Consumer Services | 22% | 14% | 16% | 9% | 14% | 14% | 14% | 16% | ||||||||||||||||||||||||||||||
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 - H2 2021 - Q1 2022 - H1 2022
| Date | Acquirer | Target | Country | Industries | Valuation multiples | See details |
|---|---|---|---|---|---|---|
| 30/06/2022 | Hillenbrand | Herbold Meckesheim | Germany | Industrial Machinery | ** | 109076 |
| 23/06/2022 | Stelrad Group | DL Radiators | Italy | Heating Components & Equipments | *** | 108993 |
| 14/06/2022 | Grupa Pracuj | Softgarden e-recruiting | Germany | Online Recruitment, Human Resource Management (HRM) | ** | 108981 |
| 07/06/2022 | Sanoma | Pearson K12 Courseware Businesses in Italy and Germany | Italy | Book Publishing, Education / Learning software | *** | 108955 |
| 06/06/2022 | Cyient | Celfinet– Consultoria em Telecomunicações | Portugal | Telecom software | *** | 109030 |
| 30/05/2022 | IMI | Bahr Modultechnik Holding | Germany | Industrial Components | ** | 108775 |
| 24/05/2022 | Renewi | GMP Exploitatie (Paro) | Netherlands | Recycling, Waste Collection Services | *** | 108930 |
| 17/05/2022 | Clearfield | Nestor Cables | Finland | Telecommunications equipment, Cables & Wires Manufacturers | * | 108906 |
| 10/05/2022 | Davide Campari Milano | Picon | France | Distilled Spirits & Liqueurs | ** | 109081 |
| 28/04/2022 | Daikin Industries | Duplomatic Motion Solutions | Italy | Pumps & PVF | * | 108920 |
| 27/04/2022 | Getinge | Fluoptics | Isère | Medical Equipment, Biotechnology | ** | 108896 |
| 26/04/2022 | Private Group led by IK Partners | Batisanté | Hauts-De-Seine | Industrial Cleaning, Fire Protection Services | * | 109009 |
| 25/04/2022 | Digital 9 Infrastructure | Ficolo Oy | Finland | IT Service Providers | ** | 108890 |
| 19/04/2022 | PTC | Intland Software | Germany | Software as a Service (SAAS), Product Lifecycle Management (PLM) | * | 108914 |
| 13/04/2022 | Private Group led by Qualium Investissement | Recocash | Yvelines | Debt Collection Services | ** | 109037 |
| 11/04/2022 | Cosmobilis (Bymycar) | Ucar | France | Automotive Services, Long-term Rental of Vehicles | *** | 108473 |
| 10/04/2022 | OpenWeb | Adyoulike | Hauts-De-Seine | Social Media Marketing | ** | 109001 |
| 08/04/2022 | CMA-CGM | Gefco (Groupages Express de Franche-Comté) | Hauts-De-Seine | Railroads, Trucking, Logistics Services | * | 109064 |
| 08/04/2022 | Sonos | Mayht (now Sonos Mighty) | Netherlands | Electronic Office Equipement and Computer Hardware (for home) | * | 108876 |
| 08/04/2022 | International Game Technology | ISBT Holdings (Isoftbet) | Malta | Online Gaming, Videogames, Gambling | * | 108986 |
| 07/04/2022 | AssuredPartners | Gallivan Murphy Insurance Brokers (GMIB.ie) | Ireland | Insurance Brokerage | ** | 108969 |
| 05/04/2022 | Allfunds Group | Web Financial Group (WebFG) | Spain | Financial Markets software, Software as a Service (SAAS) | *** | 108802 |
| 05/04/2022 | Digital 9 Infrastructure | Leeson Telecom (Host Ireland) | Ireland | Cable / Fixe Line Telecom, Telecom services for corporates | *** | 108869 |
| 04/04/2022 | Claranova SE | pdfforge | Germany | Software as a Service (SAAS), Enterprise Content Management (ECM) | * | 108862 |
| 25/03/2022 | Plastic Omnium | ams OSRAM Automotive Lighting Systems (AMLS) | Germany | Electronics / Electricity / Wiring | *** | 108205 |
| 22/03/2022 | Recticel | TRIMO, arhitekturne rešitve, d.o.o. | Slovenia | Building Materials & Fixtures | *** | 108128 |
| 18/03/2022 | Private Group led by Cathay Capital, Eurazeo and Sagard NewGen | DiliTrust | Paris | Specialized Software, Software as a Service (SAAS) | * | 108198 |
| 18/03/2022 | Ebra (Société d’Investissements Médias) | Humanoid (FrAndroid) | Paris | Internet Portals, Online Newspapers | * | 107971 |
| 14/03/2022 | Eurazeo | Horus Pharma | Alpes-Maritimes | Pharmaceuticals, Food Complements | *** | 109015 |
| 10/03/2022 | Luna Innovations | NKT Photonics | Germany | Optoelectronics | ** | 107910 |
| 08/03/2022 | Hexpol | Almaak International | Germany | Plastics Engineering | * | 107818 |
| 16/02/2022 | Nacon | Daedalic Entertainment | Germany | Videogames | * | 107940 |
| 04/02/2022 | CUMI Abrasives | Rhodius Schleifwerkzeuge (Rhodius Abrasives) | Germany | Machining Operations | *** | 107846 |
| 02/02/2022 | Ingersoll Rand | Houdstermaatschappij Jorc | Netherlands | Pumps & PVF | ** | 107870 |
| 01/02/2022 | ABF Ingredients | Fytexia | Hérault | Food Complements | * | 107545 |
| 31/01/2022 | Systemair | Tecnair LV | Italy | Building Materials & Fixtures, Heating Components & Equipments | *** | 107803 |
| 31/01/2022 | Private group led by Turenne Santé and BNP Paribas Développement | HAC Pharma | France | Biomedical Research Laboratory | *** | 109042 |
| 30/01/2022 | Grand Frais (Prosol) | Océalliance | Morbihan | Food R&W | * | 108853 |
| 28/01/2022 | Ascopiave | Eusebio Energia | Italy | Phase 4 (In Operation), Hydroelectricity | *** | 108210 |
| 28/01/2022 | House of HR | Solcom | Germany | Labour recruitment and provision of personnel (permanent) | * | 107753 |
| 24/01/2022 | Munters Group | EDPAC International | Ireland | Heating Components & Equipments | *** | 107827 |
| 13/01/2022 | Team17 Group | Astragon Entertainment | Germany | Videogames | * | 107778 |
| 13/01/2022 | Digital 9 Infrastructure | Tetra Ireland Communications | Ireland | Telecom services for corporates | *** | 107928 |
| 13/01/2022 | OEM International | Demesne Electrical Sales | Ireland | Electrical Product (retail) | ** | 108960 |
| 07/01/2022 | Ergo | Asystec | Ireland | IT Consulting | ** | 107933 |
Argos Mid-Market Index Breakdown
Access restricted to "Epsilon Eurozone Data" subscribers.
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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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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
