Less financial companies are buying up medium - February 22, 2012
Slowing economy and uncertain outlook for the euro area require, the market for acquisitions of unlisted companies worth between 15 and 150 million euros in the euro area showed a 13% drop in volume and 21% in the second half Last year, for the first half. The number of transactions was particularly low in the third quarter of 2011. The decrease was primarily due to lower transactions by LBO funds (leveraged buy out, leveraged buy-back) who are facing funding difficulties. The number of transactions fell 20% in volume and 42% in the second half. The funds are more selective. They prefer companies that have better financial performance.
Despite the removal of this category of buyers, valuations of unlisted companies averages are sustained through industry groups that have taken over from the LBO fund. According to the index semi Argos Mid-Market, conducted by the independent Office of Financial Analysis and Research Epsilon group of private equity Argos Soditic, manufacturers paid 7.5 times Ebitda (gross operating income exceeding) in December against 6.9% last time in June 2011. An increase of 4% compared to June 2011 and 14% compared to December 2010 guaranteed payday loans. They now offer the same valuations that LBO funds. But things could change because some professionals believe that the prices paid by LBO funds will decline in coming months.
Under selective
"While LBO funds focus on companies the most attractive, it is the foreign groups, especially North Americans that fueled the rise," said Gilles Mougenot, president of Argos Soditic France. These industrialists, particularly overseas, realized over 40% of industrial acquisitions against 26% two years ago. Observing France with distrust, they favor Germany. Manufacturers are very selective. They are more demanding than LBO funds. They are only interested in companies that fit their strategy, "says Gilles Mougenot. Groups such as refuse to be interested in companies that need to be restructured.
But do not all show the same appetite. Listed companies are conservative. They have realized that 51% of industrial acquisitions last December against 57% a year earlier.
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