The UK is not the most expensive place to buy a business – it’s the Nordics
Private equity firms in the UK may be finding domestic assets expensive at the moment, but it is not the priciest region according to new research.
Corporate finance firm Clearwater International has found that the Nordics was actually the place where investors coughed up most for businesses last year. They paid an average of 11 times earnings for their acquisitions, while in the UK this multiple shrank to 10.3 times from 10.4 a year earlier.
In the UK, industrials and chemicals businesses garnered the highest multiples followed by healthcare and telecoms, media and technology (TMT) firms.
Read more: UK private equity is heading for its strongest year since the financial crisis with £12bn of buyouts
Across the whole of Europe, TMT was the most popular space with multiples levelling out at 10.9 times, slightly down from 2016's 11.1 times.
Financial services was the second hottest space, but prices deflated during the year from an average of 11.9 times earnings in the first quarter to just 9.4 times in the final quarter.
The best "value" opportunities, where multiples were lowest, were in the automotive and real estate sectors.
Read more: UK healthcare companies are set for consolidation as private equity interest is piqued
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