Written by John Slater
Recently GF Data® reported that middle-market valuation multiples eclipsed previous highs in Q3 with an average TEV/Adjusted EBITDA multiple of 7.5x on $10-250mm deals.
GF Data’s proprietary transaction data from over 200 lower middle market PE firms saw continued strength in all deal sizes, but Q3 was the first quarter to show averages in the lower $10-25mm space topping at a 6.3x average valuation.
We’ve never before seen such market valuations for lower middle market companies. And many owners are electing to take advantage of the opportunity to sell at record valuations. FOCUS will end the year with a record number of closed transactions and we see no sign that the current strong market is ready to end.
But even such heady valuations pale by comparison with the red-hot photonics sector as you will see from the report below recently published by Brent Costello, Photonics and Optics Practice leader for the FOCUS Advanced Manufacturing & Automation Team. In Brent’s world, recent valuations can be measured not in multiples of profit, but in multiples of revenue!
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