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Human Capital M&A Review Q4 2017

07 March 2018

Gambit Corporate Finance LLP announces the publication of its Human Capital M&A Market Review for Q4 2017.

  • Publicly quoted companies have continued to benefit from increasing stock market values with valuations at their highest since the end of 2015.  This is pushing up valuations and increasing the prices they can pay for acquisitions, making it an opportune time for those looking to sell
  • The volume of global Human Capital transactions fell slightly in Q417 as political uncertainty continued however due to strong economic fundamentals activity is expected to increase in 2018
  • UK transaction volumes remained stable in Q417 and, with a shortage of sellers, there are several acquisitive strategic and financial buyers actively looking to acquire quality assets across a number of key sectors
  • M&A activity has so far remained resilient in the face of delays in Brexit negotiations and a lack of clarity around the nature of and strength of the UK’s future trading relationship with Europe
  • Whilst the UK as a whole is enjoying record levels of employment, candidate availability is becoming a major concern with skill shortages in engineering, healthcare and IT security and many recruiters are unsure if they can meet client demands in 2018. Those with high quality candidate pools may see interest from both strategic and financial acquirers
  • Transaction multiples continue to remain high for both general and niche assets which is providing a timely opportunity for those owners looking to realise value
  • The Gambit HC index shows that valuations have increased with an average valuation of 10.4x EBITDA compared to a valuation of 9.4x EBITDA in Q416, an increase of 10.6% over the year
  • If the shortage of sellers in the market remains then valuations could increase further going into 2018

To read the full report click here.