PB: M&A shops the discount rack

PITCHBOOK reports:

Discount prices keep global M&A activity afloat 
 
A persistently gloomy macroeconomic backdrop and near banking crisis drove a decline in M&A activity in Q1 2023, pushing global deal value down 32% from the peak just over a year prior. 
 
But total M&A deal value still topped $1 trillion for the quarter. While certain sellers—think PE—stepped back in recent months, lower valuation multiples in some cases helped encourage deal flow.  
 
Our Q1 2023 Global M&A Report, sponsored by Liberty GTS, explains which deals are happening and why, diving into dealmaking trends within industries and between regions.  
 
Key takeaways

– Multiples on PE-led buyouts collapsed by 29% in Q1 after holding firm for two years, reflecting a shift to smaller and cheaper deals.

– Smaller companies—those worth $100 million or less—have seen their median enterprise value drop to a revenue multiple of 1.1x, trailing behind the overall M&A market’s median of 1.6x. 

– Founder-owned businesses made up 85% of all businesses sold in Q1, their highest share of the market ever. 

The report, sponsored by Liberty GTS, can be downloaded here.