Chinook
Expert Advice for Business Ownership Transactions
Chinook-divider.png

OWNER RESOURCES |

RESOURCES FOR BUSINESS OWNERS


Owner Resources

As a business owner, there are many aspects to consider. You need to stay ahead of the curve, know the trends, how to handle your clients, your staff, your finances, all while keeping the big picture clear ahead. Things can change and goals need to be tweaked along the way. At Chinook, we offer you help with that clarity, those tweaks, your goals. Here, you will find some materials to help guide your way. 

The Chinook Report – 1H 2018

This report, published twice a year, provides an update on M&A activity for the first half of 2018, focusing on both global and PNW trends with a focus on transactions with an Enterprise Value (EV) between $10 million and $25 million, our target client size. Our data is sourced from GF Data, PitchBook and other publications.

Chinook-divider.png

GLOBAL M&A TRANSACTIONS POINT TOWARDS $5 TRILLION RECORD

Global M&A activity continues at record pace, surpassing $2.5 trillion for 1H 2018 with the potential for $5 trillion by the end of the year. M&A activity continues to be supported by low interest rates, strong corporate earnings, lower taxes, high equity valuations, and favorable lending terms.

Media, energy, healthcare, and technology continue to drive the larger transactions and much of transaction volume. Cross-border deals also accounted for over $1 trillion of transactions. Market headwinds include potential trade wars, regulatory uncertainty, and rising interest rates.

Aggregate Deal Value Trend

Chinook-divider.png

LOWER-MIDDLE MARKET EBITDA MULTIPLESREMAIN STRONG

The data shows that EBITDA multiples for companies with EV of $10-25 million and $25-50 million remain in-line with long-term trends (YTD 2018 5.7x and 6.7x, respectively).

Larger transactions are demonstrating a significant size premium (YTD 2018 9.2x for EV of $50-100 million vs 15-year average of 7.0x).

EBITDA Multiples

Enterprise Value 2003 - 13 2014 2015 2016 2017 YTD 2018 Total Volume
10-25 5.5 5.5 5.8 5.8 6.4 5.7 5.6 1,157
25-50 6.1 6.4 6.6 6.4 6.6 6.7 6.3 843
50-100 6.7 7.5 7.8 7.3 8.3 9.2 6.3 576
100-250 7.2 7.5 9.0 8.9 9.2 8.6 7.9 288
Total 6.1 6.4 6.7 6.8 7.4 6.9 6.3
Volume 1,897 211 241 228 235 52 2,864

Source: GF Data M&A Report May 2018

Chinook-divider.png

Enterprise Value Deal Multiples

img1.jpg
Chinook-divider.png

PNW DEAL VOLUME SHOWS GRADUAL DECLINE

For the first half of 2018, total deal volume for transactions where the target or seller is based in the PNW was 209. This figure is down from 245 for 1H2016 and 234 for 1H 2017.

Pacific Northwest Deal Volume

  Source: PitchBook

Source: PitchBook

Chinook-divider.png

The three industries with the highest level of M&A activity in the Pacific Northwest during the first half of 2018wereBusiness Services, Technology, and Healthcare.

PNW Deal Activity by Industry

  Source: PitchBook

Source: PitchBook

Chinook-divider.png

PNW Deal Activity by Investor Type

img4.jpg
Chinook-divider.png

SELECT 1H 2018 Pacific Northwest M&A TRANSACTIONS – FOCUS ON TRANSACTION SIZE $10 MILLION TO $50 MILLION

img6.jpg