Our first webinar in our series 'Company Valuation webinar: The data and stories emerging from the last 3 months of UK valuations'. is now available on demand. Understanding the quarterly trends of valuation multiples across the market is vital when making any strategic decision for the long-term future of your business, whether planning a future sale, M&A, identifying growth opportunities to maximise valuation or even for tax reporting purposes. With substantial experience valuing SME businesses in a variety of sectors, the Strategic Corporate Finance team at Price Bailey ran the first webinar in a series of in-depth quarterly valuation webinars using the very latest market data, in partnership with MarkToMarket, to analyse UK M&A transaction multiples, evaluating interesting trends across various sectors and reviewing the sentiment towards valuation multiples. During the webinar, the team shared both the data and the stories around what has driven valuations higher and lower using their experience in both expert valuation and M&A negotiation work. If you weren't able to but are interested in viewing the slides from the webinar, you can do so here.

1. Valuation Webinar
September 2023

2. Poll Question
What is the average multiple that a £700,000 EBITDA UK business sells for now?
Page 2
1x to 2.5x
2.6x to 5x
5.1x to 7.5x
7.6x to 10x
10.1x to 12.5x
12.6x +
a
b
c
d
e
f

3. UK-based targets accounted for 218 transactions –
approximately 70% in each period for sub £50m EV.
Between August 2022
and July 2023, there
were 218 reported UK
acquisitions made by
trade and PE.
Of these 118 were
profitable, reported and
EBITDA multiple and was
not considered an outlier
(Multiple above 25x).
Aug 22 – Oct 22 had the
most transactions at 76.
Feb 23 – Apr 23 had the
fewest transactions at 40.
Page 3
Outliers are companies that did not report an EBITDA multiple, were loss-making or had
an EBITDA multiple in excess of 25x.
76
59
40 43
42
35
20 21
55
41
29 30
29
21
11 10
0
10
20
30
40
50
60
70
80
Aug22 - Oct22 Nov22 - Jan23 Feb23 - Apr23 May23 - Jul23
No. of Transactions - UK Targets
All Transactions All Transactions exc. Outliers
Sub £50m Sub £50m EV exc. Outliers

4. EBITDA Multiples have trended upwards
EBITDA multiples have
trended upwards
through the last twelve
months after a dip in
Feb23 through Apr23.
The most recent quarter
includes a comparatively
higher number of
transactions at an EV
over £250m – which
typically attract a
premium multiple.
Page 4
Outliers are companies that did not report an EBITDA multiple, were loss-making or had
an EBITDA multiple in excess of 25x.
7.57
9.60
8.23
9.52
6.4
7.69
7.98
8.56
6
6.5
7
7.5
8
8.5
9
9.5
10
Aug22 - Oct22 Nov22 - Jan23 Feb23 - Apr23 May23 - Jul23
EBITDA Multiples by Quarter
Median EBITDA Multiple
Median EBITDA Multiple (Sub £50m EV)

5. Growing EBITDA has an outsized impact on valuations
We would typically
expect that a larger
company would warrant
a higher EBITDA multiple
owing to factors such as
increased market share
and pricing power
(amongst many other
factors).
There are comparatively
fewer transactions in
‘high-value’ sectors such
as Healthcare and
Financial Services in the
£50m - £250m EV
bracket.
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Outliers are companies that did not report an EBITDA multiple, were loss-making or had
an EBITDA multiple in excess of 25x.
4.89
8.12
12.02
6.29
13.06
0
2
4
6
8
10
12
14
Less than
£5m
£5m - £25m £25m - £50m £50m - £250m Over £250m
Median EBITDA Multiple by EV

6. Healthcare and Financial Service attract multiples
above 10x
After removing those
transactions described as
outliers, a wide spread
exists within individuals
industries.
Healthcare and Financial
Services reported the
highest median multiples
at 12.11x and 10.99x
respectively.
Property reported the
lowest at a median
EBITDA multiple of 7.25x.
Page 6
Outliers are companies that did not report an EBITDA multiple, were loss-making or had
an EBITDA multiple in excess of 25x.

7. US dominates overseas acquisitions of UK companies
Overseas transactions
are typically reserved for
the most valuable
companies – in part due
to the complexity of
completing the deal and
managing operations in a
foreign jurisdiction.
Of 71 transactions valued
at under £50m EV, only
13 were acquired by an
overseas entity.
Page 7
Acquirer Base
No. of
Transactions
Median EV
No. of Transactions
(Sub £50m EV)
UK 150 £7,079,966 58
US 24 £130,847,500 2
Australia 8 £15,924,645 3
Canada 6 £1,332,700,000 2
Sweden 6 £12,500,000 2
South Africa 3 £182,000,000 0
Germany 3 £415,000,000 1
France 3 £1,120,000,000 0
Other 15 £37,658,000 3
Total 218 £13,100,000 71

8. Poll Question
How do you increase valuation?
Please write your answers and suggestions in the chat box.
Page 8

9. - Appropriately including the impact of COVID on a business:
- Determining whether a poor performing year is a one-off or
the start of a downwards trend.
- Leisure-based industries were closed during most of 2020,
then had the ‘staycation’ boom in 2021.
- BREXIT – issues with cross-border trade, extra administration
and associated time, work permit issues esp. farming.
- Interest rates and inflationary environment – increasing cost
base, risks of fixed pricing contracts.
- Supply chain limitations – energy prices, container issues, raw
material shortages (e.g. microchips).
Valuation Issues
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10. Limitations
Financial information may be incomplete for some entries – Our sources
of information are limited to the disclosures made by either party in a
particular transaction, or through investigative journalism conducted by
our data providers or other reputable news source in discussion with
either company participating in the transaction.
Financial information is subject to restatement – A subject company may
restate various financial data at a date later than the analysis was
conducted.
Various deals may not be captured by the above search criteria –
Reasonable efforts have been made to ensure that the entries included
within the dataset are appropriate, but we cannot ensure that all
relevant details are captured, as this is influenced by the classification
techniques of our data providers and by the disclosures made by
transacting companies.
Previous deal data may not be indicative of future market trends –
Valuations (and multiples) may fluctuate with the economic cycle.
Adjustments made to Enterprise Value are subjective – The adjustments
made to the Enterprise Value to arrive at Equity Value will depend on
the particular companies and transactions in a number of respects.
We note that the data analysis may be naturally limited in some respects.
Page 10

11. Next webinar: 5 December 2023
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12. Page 12
Contact us
Chand Chudasama
Partner
Strategic Corporate Finance
E simon.blake@pricebailey.co.uk
T +44 (0)1223 507639
T +44 (0)7702665342
Simon Blake
Partner
Strategic Corporate Finance
E chand.chudasama@pricebailey.co.uk
T +44 (0)20 3829 1739
T +44 (0)782 414 5475
Mark Ellis
Assistant Manager
Strategic Corporate Finance
E mark.ellis@pricebailey.co.uk
T +44 (0)1603 567841
T +44 (0)7899 890846