Graphic of the week: M&A trends over the last 2-3 years
Our graphic of the week charts significant deals in Europe, highlighting the correlation between sectors, growth, EBITDA multiples and company sizes. What are the trends over the last three years (2016-2018)?
The at-a-glance summary below shows payor pressures and subsequently sluggish growth leading to low multiples in the hospital sector. Hospitals also show the strongest correlation of all the sectors between price and market growth, perhaps because it is the most developed and consolidated market and therefore the most homogenous.
Unsurprisingly, more fragmented markets like ophthalmology, dentistry, psychiatry and elderly care show high multiples – despite lower growth. Buyers in these sectors are placing big bets on the potential for inorganic growth. Company revenue at purchase is shown by the size of the bubble.
We only consider deals: a) that took place in developed European markets b) in which the acquired asset had at least €50m in sales at purchase c) for which we know the multiple paid or have a good idea.
Imaging looks like an anomaly; the outlier is Life’s 13xEBITDA purchase of Anglo-Italian imaging services group Alliance – the UK market is playing catch-up with European peers by putting more money into diagnostics and this explains the scope for growth.
Also of note are the high prices in Finland. The three green circles are Mehilainen-Attendo, Terveystalo’s IPO and CVC-Mehilainen, who have digital expertise and more diverse offerings.
The largest spread of prices can be found in the nursing home market most evident by the high prices paid in the nascent and fragmented Spanish market.
HBI Deals+Insights and Intelligence members can click here for a page with the full interactive infographic, which shows details on each deal in the graph.
We would welcome your thoughts on this story. Email your views to Cameron Murray or call 0207 183 3779.
