Private Company Valuation Database
An authoritative guide to the pricing of private company sales and acquisitions across the UK.
The PERDa database uses information on completed private company deals to provide a robust insight of both historic and current Price Earning Ratios (i.e consideration as a multiple of the target’s profits). All data is adjusted to show the actual consideration paid and the target’s true underlying profits, and therefore provides far more meaningful data than measures that are restricted to publically available information. Data is provided by corporate finance advisors and Experian.
UK HISTORIC PRICE EARNING RATIOS (“PER”)
The graph shows the rolling six month average ratio between enterprise values and underlying profits (EBIT) for deals across the UK.
(Data is set out in the newsletters)
Following the extreme peaks and troughs of 2008 to 2010, PERs remained relatively stable from 2012, with a gentle increasing trend to 2016. The subsequent 30 months have shown a return to volatility with several notable high value SME transactions producing spikes in the average PER and also a slight downward trend.
EBIT PERs fell from 6.6 in the second half of 2018 to 6.5 in the third quarter of 2019, before dropping to 6.4 in the final quarter. This has now fallen slightly below the long terms averages (5 year: 6.9 and 10 year: 6.5). Although there is an appetite for high quality businesses, investors are being more cautious in terms of the multiple they are willing to pay.
For more detailed commentary and definitions, please read our newsletters.