Tech, Media, Telecoms

Advisers who understand your sector

Our tech, media, telecoms sector team brings together a broad range of experience across software, IT, e-commerce, digital, media, marketing communications, mobile, electronics and telecommunications.

Members of our advisory team have worked in an operational, management or advisory capacity for a wide variety of companies in the sector, including:

How much are companies worth in the Technology, Media and Telecoms sector?

The following 3 graphs will give private business owners a broad indication of the value of their business:

1. The Enterprise Value to EBITDA* multiples on which comparable listed companies are trading
TMT - graph 1

At the end of H1 2020, the global, all market average Enterprise Value to EBITDA multiple for listed TMT  companies was 14.2x. This is slightly lower than the previous six months, when listed TMT companies were trading on a multiple of 14.8x. Within the TMT sector, trading multiples varied between 7.2x and 17.6x across the range of sub-sectors. Smaller businesses generally traded on lower multiples.

* EBITDA is Earnings Before Interest, Tax, Depreciation and Amortisation
† Note, the Enterprise Value to EBITDA multiples above are for listed businesses. By comparison privately owned businesses are generally valued at a discount. Listed company data was accurate at 01/07/2020.

2. The multiple of EBITDA paid by acquirers of comparable businesses

TMT - graph 2

The average multiple of EBITDA* paid globally in TMT transactions has increased over the past 6 months. It currently stands at 10.8x. When reviewing these multiples we break out businesses in the range $5-150m, as they tend to have unique attributes which affect their valuation. Smaller businesses have generally been sold on lower multiples.

* EBITDA is Earnings Before Interest, Tax, Depreciation and Amortisation
†Note, the transaction multiples above are calculated from raw historic data. This typically understates profits and therefore valuations actually achieved are generally at lower multiples of “normalised” profits.

3. The volume of M&A transactions and acquisitions

TMT - graph 3

In H1 2020, there were 3,567 transactions globally in the TMT sector. This is the same figures as the preceding 6 months, when there were 3,567 transactions. The stability in transaction numbers over the last 6 months suggests demand for TMT businesses remains strong.

For further information as to how these valuations and statistics are computed, and their impact on your transaction, please contact us.