M&A: average premiums in the UK 2017-2018, by industry

Average premium multiples are used to gauge the excess an acquiring company may expect to pay over the market trading value of the seller's shares. In its simplest form the calculation shows the percentage paid on top, over the value of the company being sold that an acquirer pays. Between 2017 and 2018, In the United Kingdom (UK), the average premium to four-week stock price paid for consumer staples companies almost doubled. This was far higher than the global average paid.

Premiums globally

  When broken down into key markets and global regions, premiums paid to four-week stock prices became slightly more favorable to buyers. The United States, which typically has higher average premiums saw several industries including telecommunications, consumer products and services and the financial industry see notable decreases in premiums paid.

Value/EBITDA multiples

  Value/EBITDA or enterprise value to earnings before interest, taxes, depreciation and amortization is a key measurement ratio used as a metric of valuing a company to an industry average. Between 2017 and 2018, a significant number of industries increased in value/EBITDA in the UK. The most significant being seen in the consumer products and services industry.

Average merger and acquisition (M&A) premiums to four week stock price in the United Kingdom (UK) in 2017 and 2018, by industry

20172018
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Source

Release date

December 2018

Region

United Kingdom

Survey time period

2017 and 2018

Supplementary notes

The source added the following information "The data given refers to the time period 01/01/2017 - 12/31/2018 and all spinoffs, splitoffs, open market repurchases, exchange offers and equity carveouts are excluded. Average premium to 4 week stock price prior to announcement is capped at 100%."

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Statistics on "Mergers and acquisitions in the United Kingdom (UK) and the Republic of Ireland"

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