2018 Key Highlights
- The most active acquirer in 2018, either directly or through an affiliated business, was Leeds Equity Partners with seven transactions. Two of these deals involved companies that serve the financial sector: Pass Perfect, a provider of Financial Industry Regulatory Authority (“FINRA”) license exam training; and Keir Educational Resources, which offers training solutions for financial services professionals.
2018 Key Trends
- Total transaction volume in 2018 increased by nine percent over 2017, from 392 to 428.
- Strategic volume in 2018 saw a three percent uptick over 2017, from 277 to 284. Private equity backed volume gained 25 percent during this timeframe, from 115 to 144.
- Total transaction value in 2018 declined by eight percent over 2017, from $16.81 billion to $15.52 billion. However, value more than tripled in 2017 over 2016.
- The median revenue multiple decreased from 2.3x in 2017 to 2.0x in 2018. The median EBITDA multiple improved from 11.0x in 2017 to 12.0x in 2018.
- Professional Training Services nearly overtook K-12 Media and Tech as the industry’s most active sector during the year. The segment experienced a 28 percent increase, from 71 to 91 transactions. K-12 Media and Tech volume increased 19 percent, from 80 to 95 deals, which was about the same as its 2016 level.
M&A Market Overview
Berkery Noyes tracked 1,213 Education transactions between 2016 and 2018, of which 238 disclosed financial terms, and calculated the aggregate value to be $29.38 billion. Based on known transaction values, we project values of 975 undisclosed transactions to be $8.19 billion, totaling $37.57 billion worth of transactions tracked over the past three years.
Disclosed median enterprise value multiples for all segments combined in this report during the last 36 months were 2.1x revenue and 10.2x EBITDA.