Succession and Exit
Management Consulting Mergers and Acquisitions Report 2017 by Equiteq
According to the recently released Equiteq annual Global Consulting M&A Report ( always excellent data ) , several relevant trends appear:
- In 2016, the number of global transactions reached a 9-year high of 2,906, with multiples averaging a 10-year high of 1.1x revenue, and 8.6x EBITDA
- Cross-border activity remained strong, accounting for 28% of all deal volumes and 33% of deals in the $10m to $500m value range
- 397 deals were completed in Asia-Pacific, with an average valuation of $14.5m and average multiples of 1.4x revenue and 7.2x EBITDA
- In total, there were 130 deals in Australasia in 2016, accounting for 33% of consulting M&A volumes in the APAC region
Management Consulting Insight:
- Exceeding the high-growth IT consulting sector, Management Consulting M&A rose to a ten-year high in 2016 with a significant share of 29% in global consulting M&A deal values.
- Traditional large consulting agencies remained the most prolific buyers of management consultancies, including Deloitte, Accenture, BCG, etc. A noteworthy point is that a large proportion of reported M&A is under $10m. Buyer rationales for these acquisitions being search for bolt-on acquisitions of lower- and mid-market consultancies.
- There were 946 deals involving management consulting companies in 2016, with a much higher mean deal value of $111m compared to $70.2m in 2015, while transaction multiples remained stable at around 10x EBITDA.
- Several niche areas within Management Consulting have consistently achieved high valuations, including Financial Advisory, Healthcare and Analytical Strategy firms.