Retail Update : Second Quarter 2012
Deloitte Financial Advisory Services
This quarter’s Retail Update, produced by Deloitte Financial Advisory Services, summarizes the most recent transactions along with information on the most active buyers, current transaction valuation multiples and an overview of the public market’s perception of the industry.
This quarter’s highlights
At the European level, Retail M&A yearly deal volume has been increasing in the last three years, from 160 transactions in 2009 to 209 transactions in 2011 (see first chart in following page). It seems however that deal volume is stabilising as Q2’12 follows the same tendency with 48 announced transactions (see last chart of this page). During the LTM the following trends have been observed:
- 205 transactions were announced between Q3’11 and Q2’12 compared to 195 per LTM’11 (from Q3’10 until Q2’11). As shown on the last right-hand chart, announced European transactions during the Q2’12 amount to 48, which represents a decrease of 23% compared to Q2’11. Since Q2’11 (62 transactions), which was considered as an exceptional quarter, European transactions remain relatively stable with an average of 52 transactions per quarter;
- 18 private equity backed transactions (either as a buyer or as a seller) were announced in Q2’12 which is 33% lower than in Q2’11, and 77 PE transactions were announced over the LTM;
- Average enterprise value per disclosed deal was lower during LTM (€245m) than in 2011 (€276m). However, median enterprise value per disclosed deal was higher the LTM (€47m) compared to 2011 (€44m), reflecting the fact that larger deals were announced during H1’12;
- Finally, as shown on the last chart of the following page, median transaction multiples remained steady at a level of 11.8x EBITDA during the LTM despite lower multiples in Q2’12 (median of 6.9x). This is explained by higher ratios in Q3’11 (20.8x) and Q4’12 (16.1x).
Download the Retail Update for more information.