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Full Year 2016 Private Equity Industry Trends
2016 Key Highlights
- The industry’s two largest transactions in 2016 each occurred in the Entertainment vertical. This consisted of a Chinese consortium’s announced acquisition of Playtika, a social and mobile games company based in Israel, for $4.4 billion; and IMG Worldwide’s acquisition of Ultimate Fighting Championship, a professional mixed martial arts organization, for $4 billion.
- Six of the overall Healthcare vertical’s top ten highest value deals during the year were backed by financial sponsors. The largest private equity backed Healthcare IT deal in 2016 was GI Partners’ acquisition of Netsmart Technologies, a provider of electronic health records, patient management, billing and other solutions, which was acquired in a joint venture with Allscripts, for $950 million.
2016 Key Trends
- Total transaction volume in 2016 saw a slight uptick over 2015, from 629 to 638.
- Total transaction value in 2016 remained about constant over 2015, from $65.41 billion to $64.67 billion. Of note, each of the top five and eight of the top ten highest value deals in 2016 occurred during the second half of the year.
- The median revenue multiple declined from 2.3x in 2015 to 2.0x in 2016. The median EBITDA multiple fell from 13.2x in 2015 to 10.9x in 2016.
M&A Market Overview
Berkery Noyes tracked 1,820 private equity transactions in the Information Industry between 2014 and 2016, of which 338 disclosed financial terms, and calculated the aggregate value to be $139.15 billion. Based on known transaction values, we project values of 1,482 undisclosed transactions to be $44.20 billion, totaling $183.35 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 2.0x revenue and 11.2x EBITDA.