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 H2 2019, the global, all market average Enterprise Value to EBITDA multiple for listed TMT companies was 14.8x.This was greater than for the previous six months and also higher than the previous year, when listed TMT  companies were trading on a multiple of 12.5x. Within the TMT sector, trading multiples varied between 7.5x and 19.1x 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 10/01/2020.

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 declined slightly over the past few years. It currently stands at 7.5x. 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 H2 2019, there were 3,567 transactions globally in the TMT sector. This is slightly up on the preceding 6 months, when there were 3,459 transactions. The uptick in transactions in 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.