Research finds that market dynamics are driving premium M&A valuations for consulting firm owners

Share Article

Equiteq’s 2016 survey of global buyers of knowledge-intensive services businesses, found that strong acquisition demand coupled with fewer opportunities coming to market is creating increased competition for assets, leading to robust valuations for business owners

David Jorgenson Equiteqs CEO

Demand for acquisitions remains very strong, and the momentary slowdown in new opportunities mean that sellers may be able to extract a scarcity premium through a carefully managed sale process.

With an average budget for consulting acquisitions of $70m and an expectation to make nearly 4 acquisitions in the next 2-3 years, the research found that strategic buyers have significant propensity to buy.

Private equity respondents, not only show a willingness to pay a higher price but have an interest in Intellectual Property rich consulting businesses and appetite for businesses with a financial services or healthcare sector focus.

This independently conducted research of Management consulting, IT consulting, Media and Marketing, Engineering consulting and HR consulting buyers, found convergence as a key buying trend. Notably, Human resources buyers are looking to acquire in Management consulting and there is convergence in demand between Management consulting, IT consulting and Media buyers as well as across IT consulting and Engineering consulting buyers.

David Jorgenson, CEO at Equiteq, comments “Our key takeaway from the report is that sellers should take advantage of the current conditions. Demand for acquisitions remains very strong, and the momentary slowdown in new opportunities mean that sellers may be able to extract a scarcity premium through a carefully managed sale process.”

Equiteq’s Buyers Research report is available to download for free here.

About Equiteq

Equiteq is a consulting sector M&A specialist. The company works with consulting firm shareholders, helping them to achieve their business objectives and exit strategies. Equiteq’s services are designed to deliver great returns for its clients, by accelerating revenue, profit and equity value growth, and ultimately realizing that value in a trade sale or other type of liquidity event.

About Equiteq’s Buyers Research Report 2016

In its third year, this annual research was conducted by an independent research agency. Telephone interviews were carried out among partners, board members, M&A leads and their reports who are responsible for buying consulting firms around the globe. The report addresses M&A activity expectations and demands, consulting segment findings, buyer evaluation, valuation insights, deal structuring & investment appraisal.

The full report can be downloaded free from here.

For more information and media enquiries, contact Paula Allerton of Equiteq on +44 203 651 0600 or paula.allerton@equiteq.com. Visit http://www.equiteq.com/equiteq-edge/register for free access to Equiteq Edge – Equiteq’s online resource and information hub aimed at shareholders, prospective shareholders, investors and corporate development executives in the consulting industry.

Share article on social media or email:

View article via:

Pdf Print

Contact Author

Sophie Lewis
Equiteq
+44 2079474458
Email >
@ConsultingMandA
Follow >
Visit website