Recent Findings from the AVCAL Deal Metrics Survey 2012 - Succession Plus

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Recent Findings from the AVCAL Deal Metrics Survey 2012

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Recent Findings from the AVCAL Deal Metrics Survey 2012

By , January 13, 2013

According to the fourth annual report of private equity ( PE ) and venture capital (VC ) deal activity, covering deals executed up to the end of June 2012, which covers $77.7b worth of transactions ( 1606 deals in total ) by 170 funds between 2006 – 2012. In spite of the interesting economic climate PE transaction value and volume remained constant and respondents were confident that the deal pipeline in FY12 had improved “driven by succession pressures and converging price expectations.”

Weighted average pricing multiples ( EV / EBITDA ) declined from 8.3 in FY11 to 6.8 in FY12, however “many funds noted that good multiples were still available for strong assets with promising growth trajectories.”

In terms of outlook, the report concludes that the deal pipeline ” Looks set to improve in 2013 in terms of volume and quality of opportunities it presents. Potential public – to – private transactions should remain on the radar, especially for stocks with a small market cap…… As a result of the relative strength of the Australian economy, we should see continuing interest by international PE funds in Australian Assets.”

From a sector perspective, “businesses in health and aged care, education, infrastructure and financial services are likely to be strong growth areas in FY13″

Craig West

Craig West

Managing Director | Succession Plus

Craig West is a strategic accountant who has over 20 years’ experience advising business owners. His background as a CPA in public practice, provided invaluable experience in the key issues of concern to business owners. Following 6 years of study to gain two masters degrees, Craig focused on Capital Gains Tax (CGT) for business sales advising on strategic management of tax issues. This experience formed a very strong view that business owners (and often their advisers) were unprepared and unaware of the steps required to prepare a business for exit.

Craig now acts as a strategic mentor for mid-market business owners and has written four critically acclaimed books on employee incentives, succession planning, asset protection and exit strategies. Craig has conducted numerous seminars and keynote presentations throughout Australia & internationally, including adviser education programs for the Institute of Chartered Accountants and CPA Australia.