Financial

Advisory

M&A

Dealtracker 2020
Australian M&A and IPO market insights
November 2020
Our key insights 04
M&A deal volumes 06
Sector composition 08
Top 10 deals in the 18 months to June 2020 12
The buyers 14
Top 5 cross-border inbound deals 17
Australia’s core M&A: mid-market business 18
Investment managers 20
Valuation multiples by target size 22
Valuation multiples by target sector 24
Domestic vs international valuation multiples 26
Corporate M&A versus IM valuation multiples 28
Share price performance of listed companies by target sector 31
IPO activity in Australia 34
IPO size by sector 37
Top IPOs in each sector (18 months to 30 June 2020) 38
Listing multiples and immediate price returns by target sector 39
Private equity story 41
Working together 43
Depth of experience 44
Corporate finance services 45
Mergers & aquisitions 46
Transaction advisory services 47
Valuation services 48
Financial modelling services 49
Methodology 50
About us 51
Welcome to the seventh edition of
Dealtracker, our analysis of the Australian
mergers and acquisition (M&A) and
equity markets. This edition covers
transactions during the 18 month period
from 1 January 2019 to 30 June 2020.

Dealtracker 2020 3
Summary of findings

Our key
insights

Deal activity affected by Pandemic Overseas acquirers remain relevant

Deal volume up to 31 December 2019 was Overseas purchasers comprised 29%
strong with a record number of deals of transactions, down from 31% in the
reported for CY2020 over the history previous Dealtracker period to reverse
of this publication. The level of activity the upward trend evident in prior years.
decreased significantly during H1 2020 as This reversal can be attributable to the
the pandemic took hold falling to levels challenges faced with cross border
not seen since 2017. At the issuance of deals since the commencement of
this report, there has been an increase the pandemic given travel restrictions
in activity levels as participants start to and foreign investment regulatory
consider a post pandemic period despite tightening. Notwithstanding these
the uncertainties that remain. This interest headwinds, their remains appetite for
is particularly focused on technology overseas acquirers to continue pursuing
enabled opportunities that may benefit Australian assets aided by the use of deal
from the shift in consumer and employee related technology and a willingness to
behaviours post pandemic. accommodate the extended approval
process.

4 Dealtracker 2020
Investment Managers Deal multiples
Investment Manager (“IM”) activity The median multiples of EBITDA across
continued to be strong during the period the market as analysed during this
despite the overall pandemic related Dealtracker period was 8.1x which was
slowdown that occurred in H1 2020. an increase since the last Dealtracker
This was driven by Managers’ continued report of 7.1x and slightly higher than the
access to significant funding and their long-term historical average of 7.8x. This
interest in Information Technology and was partly due to outperformance in the
wider technology enabled opportunities Consumer Discretionary, Healthcare,
that have been the standout drivers of Materials and Energy sectors.
deal volume during this period.

Primary and Secondary Listed Markets Expected market themes

IPO primary issuances experienced Whilst predicting market conditions
a material decline as a result of the over the next Dealtracker period is
pandemic with small volumes reported extremely difficult, the current market
for H1 2020. This was offset to a certain themes around the acceleration of
degree by the significant secondary deploying technology across all sectors
issuances that occurred during that will continue to drive deal activity
period with many corporates focusing and in particular IM activity levels in
on ensuring they had sufficient liquidity the next 18 months. Notwithstanding
to trade through the pandemic period. this theme, there remains caution
As with overall activity levels, there has on the trading environment that will
been strong appetite by companies to occur once government stimulus is
access the IPO markets in the months materially reduced and the ongoing
preceding the issuance of this report risks associated with the inevitable
with much of this demand related to waves of infection that will occur prior
technology enabled opportunities. to a vaccine becoming widely available.
This may lead to lower deal volumes
and asset valuations should these risks
remain for an extended period of time.

Dealtracker 2020 5
M&A deal volumes

Overall deal volumes were consistent with the previous period. However,
it was a period of two halves with a high number of deals recorded in
the second half of CY2019 and a material reduction in deals recorded in
the first half of CY2020 caused by the global pandemic.

Introduction M&A deal trends

This seventh edition of Dealtracker focuses on Australian Our analysis shows that the number of M&A deals during
mergers and acquisitions (M&A), and equity market activity the 18 months to 30 June 2020 was on par with the previous
during the 18 month period to 30 June 2020 (“the period”). Our reported period (18 months to 31 December 2018). The
previous Dealtracker (edition six) covered the 18 months to 31 increased number of deals in second half of 2019 calendar
December 2018 and edition five covered the 18 months prior. year was offset by the pandemic caused decline in the first half
of CY2020.
The data in this report was compiled from several sources
including S&P Capital IQ, the Australian Securities Exchange, On a quarterly basis, the fourth quarter of 2019 was a record
Mergermarket, IBISWorld, transaction surveys, company for this publication, with a total of 301 deals occurring during
announcements and other publicly available documents. the quarter comprising 22% of the total deals for the full
period. In comparison, the first and second quarters of the
We consider this consolidated multi-source analysis – following year (Q1& Q2 CY2020) represented only 13% and
supplemented with our own proprietary sources – to provide 12% of total deals within the period.
the most comprehensive insight into recent Australian deal
activity. Following the strong level of activity in the second half of CY
2019, which comprised 42% of the total deals for the period,
This survey is limited to going concern business sales, excluding deal volumes plummeted below previous period numbers and
those with a significant real estate nature and greater than fell to levels last observed in first half of 2017. The recent decline
$5m value. in activity over Q1 and Q2 CY2020 is aligned with the global
economic downturn caused by the COVID worldwide pandemic
The currency referred to throughout the document is in
and its consequences on economic, mobility and accordingly
Australian dollars.
deal activity.

6 Dealtracker 2020
M&A – Prior comparative Dealtracker periods

Dealtracker 7 1,394
Dealtracker 6 1,403
Dealtracker 5 1,279
Dealtracker 4 1,271
Dealtracker 3 1,174
Dealtracker 2 1,012
Dealtracker 1 1,718

M&A – Annual trends

2020 354
2019 1,040
2018 810
2017 945
2016 927
2015 799
2014 817
2013 829

M&A – Quarterly & half yearly trends

Q2 2020 173 H1 2020

Q1 2020 181 354 deals

Q4 2019 301 H2 2019

Q3 2019 279 580 deals

Q4 2019 233 H1 2019

Q1 2019 227 460 deals

Q4 2018 172 H2 2018

Q3 2018 227 399 deals

Q2 2018 198 H1 2018

Q1 2018 213 411 deals

Q4 2017 302 H2 2017

Q3 2017 291 593 deals

Q2 2017 184 H1 2017

Q1 2017 168 352 deals

Q4 2016 238 H2 2016

Q3 2016 270 508 deals

Q2 2016 205 H1 2016

Q1 2016 214 419 deals

Q4 2015 173 H2 2015

Q3 2015 216 389 deals

Q2 2015 208 H1 2015

Q1 2015 202 410 deals

Q4 2014 221 H2 2014

Q3 2014 251 472 deals

Q2 2014 194 H1 2014

Q1 2014 151 345 deals

Q4 2013 243 H2 2013

Q3 2013 203 446 deals

Q2 2013 189 H1 2013

Q1 2013 194 383 deals

Dealtracker 2020 7
Sector composition

The continued movement of the Australian economy from a resource

led economy to a knowledge-based service economy that has been
observed over these reports has accelerated through this period with
the Information Technology sector showing considerable growth in deal
activity boosted by pandemic market conditions.

The composition of M&A deals by sector is driven by a focus on Deal flow in the Financials sector also experienced a marginal
innovation through adoption of new technological capabilities fall of 8% compared with the previous Dealtracker period
and also continues to exemplify the transition of the Australian and now comprises 8% of M&A activity during the period,
economy from a resources driven economy to a diversified with regulatory uncertainty offset by the continuing trend of
service based M&A market. financial institutions simplifying their operating structures and
the continued emergence of Fintech.
A surge in Information Technology deals occurred as
established trade buyers across sectors become increasingly M&A – Deal composition by sector
inclined toward innovative investment strategies to enhance 1,403 1,394
8/1%
their technological capabilities, protect their businesses in 18/1%
31/2%
1,271 43/ %
the new trading environment, whilst seeking to tap into new 1,279 86/6%
customer markets. Deals in this sector increased over the 16/1% 13/1% 125/9%
34/3% 34/3%
99/7%
period from 238 to 321 deals which represents 35% growth 103/8% 9 /7%
95/7%
from the preceding 18 month period. This was the largest 103/7%
106
increase in relative share for the period. Volumes in this sector 78/6% 82/6%
8%
37/3%
are predicted to remain strong as buyers continue to seek 136 118/8%
128
the expansion of their digital capabilities to serve customer 154 11%
9%
12%
and workforce preferences that have shifted as a result of the 131 195
pandemic and create operational further efficiencies. 10% 14%
268
294 19%
Consistent with prior periods, the Industrials sector remains 23%
275
the main focus for Australian M&A activity with 30% of total 22%
321
deal flow and the numerically the second largest increase 23%
in deal volume at 14% growth since the prior Dealtracker 238
period to 31 December 2018. This continued strength can be 223 17%
18% 194
partly attributable to the ongoing consolidation in the sector 15%
to increase operational efficiencies and the acquisition of
Intellectual property for deployment in foreign markets.
329 293 365 417
The third sector which recorded an increase in the number of 26% 23% 23% 30%
deals for the period was Consumer Staples, which grew by
8% from 92 to 99 deals. The number of deals in other sectors
declined on a scale from 3% in Materials sector to 56% in 18mths ending 18mths ending 18mths ending 18mths ending
31 Dec 2015 31 Jun 2017 30 Dec 2018 30 Jun 2020
Telecommunications on low volumes.
Telecommunication services Materials
Utilities Financials
Energy Consumer Discrentionary
Healthcare Information technology
Consumer staples Industrials

8 Dealtracker 2020
“
The hunger for enhancing digital capabilities
to serve customers and workforce changes
post pandemic is driving investment in new
technologies, whilst the Industrials sector has
remained buoyant as the consolidation trend
continues.”

Dealtracker 2020 9
Corporate M&A has focused on Corporate deals by sector (current period)

the trend of consolidation in the

Industrials sector, whilst investment 31% Industrials
22% Information Technology
managers have focused on 14% Consumer Discretionary
8% Financials
the Consumer Discretionary, 8% Materials
7% Consumer Staples

Information Technology and 6% Healthcare

2 % Materials
1% Utilities
Consumer Staples sectors. 1% Telecommunication services

Corporate deals by sector (prior comparable period)

26% Industrials
17% Information Technology
20% Consumer Discretionary
9% Financials
8% Materials
6% Consumer Staples
9% Healthcare
3 % Materials
1% Utilities
1% Telecommunication services

10 Dealtracker 2020
IM deals by sector (current period) • In line with the prior Dealtracker period, the vast majority
of corporate acquisitions occurred in the Industrials 31%
[PP: 26%] and Information Technology sectors 22% [PP
35% Information Technology
17%]. The relative shares for Consumer Discretionary and
23% Industrials Healthcare sectors declined – 14% [PP20%] for the former
16% Consumer Discretionary and 8% [PP 9%] for the latter.
8% Financials
6% Consumer Staples
7% Healthcare • These decreases can partly be explained by the disruption
2% Materials
caused to both sectors by the lockdowns imposed by
1 % Energy
1% Telecommunication services State governments to deal with the pandemic. Whilst
1% Utilities the Healthcare sector is expected to provide greater
opportunities as lockdowns ease, the Retail sector is likely
to be a difficult area to invest for some period other than for
distressed opportunities. Other corporate activities remained
IM deals by sector (prior comparable period) largely similar to the comparable prior period.

• In regards to IM acquisitions, we observed a dramatic

21% Information Technology increase in Information Technology deals from representing
23% Industrials 21% in the previous period to 35% currently. Whilst this
16% Consumer Discretionary
trend to invest in technology enabled businesses was
8% Financials
11% Consumer Staples already in place prior to the pandemic, the dramatic shift
11% Healthcare in consumer preferences and behaviours along with the
5% Materials
need for businesses to amend their operational models
2 % Energy
2% Telecommunication services has accelerated IM interest in the sector. A similar theme is
2% Utilities evident in public market activity as well.

• The largest decline in IM deal flow was seen in the Healthcare

– from 11% to 7%, Consumer Staples - from 11% to 6%
and the Materials sectors – from 5% to 2%. As indicated
previously, most sectors outside technology experienced
material declines in activity levels since the onset of the
pandemic given the lack of visibility of medium term trading
conditions that exist for acquisition targets.

Dealtracker 2020 11
Top 10 deals
in the 18 months to June 2020

Acquirer: Asahi Group Holdings, Ltd. CUB Pty Ltd engages in the production and distribution of beer in
Australia and internationally. The company also offers ciders and spirits.
Target: CUB Pty Ltd CUB Pty Ltd was formerly known as Foster’s Australia Limited.
Transaction Value AUD(m): A$16,000 million Asahi is a Japanese global beer, spirits, soft drinks and food business
group headquartered in Sumida, Tokyo.
Date: 01 June 2020
Asahi Holdings (Australia) Pty Ltd agreed to acquire CUB Pty Ltd from
EV/EBITDA multiple: 14.9x Anheuser-Busch InBev SA/NV (ENXTBR:ABI) for an enterprise value of AUD
16 billion.

Acquirer: Vodafone Hutchison Australia Pty Vodafone Hutchison Australia is a private company owned by Vodafone
Limited Group Plc and Hutchison Telecommunication Australia.
Target: TPG Telecom Limited Vodafone Hutchison Australia, an Australia-based mobile
telecommunications provider, has agreed to merge with TPG Telecom, an
Transaction Value AUD(m): A$ 8,688 million Australian internet service provider.
Date: 29 June 2020 Deal terms - 1 VHA share per TPG share.
EV/EBITDA multiple: 10.3x

Acquirer: Brookfield Capital Partners Ltd.; Healthscope Limited provides healthcare services in Australia and
Brookfield Business Partners L.P. (NYSE:BBU) New Zealand. The company operates through Hospitals Australia and
Pathology New Zealand segments.
Target: Healthscope Limited
Brookfield Asset Management Inc. is an alternative asset management
Transaction Value AUD(m): $5,635 million company focusing on real estate, renewable power, infrastructure and
private equity.
Date: 06 June 2019
EV/EBITDA multiple: 14.3x Brookfield Capital Partners Ltd. made a proposal to acquire Healthscope
Limited (ASX:HSO) from NorthWest Healthcare Properties Real Estate
Investment Trust (TSX:NWH.UN) and others for AUD 4.3 billion on May 14,
2018.

Acquirer: Nippon Paint Holdings Co., Ltd. Dulux Group Limited manufactures, markets, sells, and distributes paints,
(TSE:4612) coatings, adhesives, and garden care and other building products in
Australia, New Zealand, Papua New Guinea, South East Asia, China, and
Target: Dulux Group Limited the United Kingdom.
Transaction Value AUD(m): $4,333 million Nippon Paint Holdings Co., Ltd is a Japanese paint and paint products
Date: 21 August 2019 manufacturing company.

EV/EBITDA multiple: 16.5x Nippon Paint Holdings Co., Ltd. (TSE:4612) agreed to acquire DuluxGroup
Limited (ASX:DLX) for AUD 3.8 billion on April 16, 2019

12 Dealtracker 2020
Acquirer: Mitsubishi UFJ Trust and Banking Colonial First State Global Asset Management (CFSGAM) is an Australia-
Corporation based company engaged in the global investment management
business, headquartered in Sydney.
Target: First Sentier Investors
Mitsubishi UFJ Trust and Banking Corporation is a Japan-based
Transaction Value AUD(m): $4,130 million company engaged in providing commercial banking, asset management
and administration, real estate and stock transfer agency services.
Date: 02 August 2019
MUTB has agreed to acquire 100% stake in CFSGAM from CBA for a total
EV/EBITDA multiple: 42.1x cash consideration of AUD 4.13bn (USD 2.93bn).

Acquirer: Resolution Life Australia Pty Ltd Resolution Life Group Holdings LP, parent of Resolution Life Australia
Pty Ltd, is a global life insurance group focusing on the acquisition and
Target: Australian and New Zealand Wealth management of portfolios of life insurance policies.
Protection and Mature Businesses of AMP Limited
Resolution Life Australia Pty Ltd agreed to acquire Australian and New
Transaction Value AUD(m): $3,000 million Zealand wealth protection and mature businesses from AMP Limited
Date: 30 June 2020 (ASX:AMP) for AUD 3 billion.

EV/EBITDA multiple: N/A

Acquirer: Macquarie Infrastructure and Real AirTrunk Operating Pty Ltd. is a company engaged in providing cloud
Assets storage of data and backup services.

Target: AirTrunk Operating Pty Ltd. (88% Stake) Goldman Sachs & Co. LLC and TPG Capital LP have agreed to sell
undisclosed majority stake in AirTrunk Operating Pty Ltd. to Macquarie
Transaction Value AUD(m): $2,640 million Infrastructure and Real Assets (MIRA), for an undisclosed consideration.
Date: 08 April 2020
EV/EBITDA multiple: N/A

Acquirer: Santos Ltd Santos Ltd is the listed Australia-based ASX-listed company engaged in
the exploration, development, production, transportation, and marketing
Target: ConocoPhillips Company of hydrocarbons, headquartered in Adelaide.
(northern Australia business)
ConocoPhillips Company is the listed US-based integrated energy
Transaction Value AUD(m): $2,158 million company that explores, produces, transports and markets crude oil,
Date: 27 May 2020 natural gas, natural gas liquids and bitumen, headquartered in Houston,
Texas.
EV/EBITDA multiple: N/A
Santos Ltd has agreed to acquire ConocoPhillips’s north Australian
business from ConocoPhillips Company.

Acquirer: KKR & Co. Inc. (NYSE:KKR) MYOB Group Limited develops and publishes software in Australia and
New Zealand. It provides its solution for SMEs and advisers.
Target: MYOB Group Limited
KKR & Co. Inc. is an American global investment company that manages
Transaction Value AUD(m): $2,072 million multiple alternative asset classes.
Date: 08 May 2019 KKR & Co. Inc. made a proposal to acquire remaining 80.1% stake in
EV/EBITDA multiple: 18.5x MYOB Group Limited (ASX:MYO) from Bain Capital Abacus Holdings, L.P.
and others for AUD 1.7 billion.

Acquirer: AustralianSuper Pty. Ltd.; Remjay Navitas Limited provides educational services for students and
Investments PTY Ltd; BGH Capital; Hoperidge professionals in Australia, the United Kingdom, Europe, Asia, Canada, the
Enterprises Pty Ltd Superannuation Fund United States, and internationally.
Target: Navitas Limited Australian Super Pty. Ltd., the largest Australian superannuation and
pension fund, made a preliminary, conditional and non-binding proposal
Transaction Value AUD(m): $2,069 million to acquire remaining 85% stake in Navitas Limited (ASX:NVT) from Jones
Date: 05 July 2019 Family Trust, Remjay Investments PTY Ltd, Hoperidge Enterprises Pty Ltd
Superannuation Fund and others for AUD 1.6 billion.
EV/EBITDA multiple: 27.9x

Dealtracker 2020 13
The buyers

The proportion of investment manager activity as a composition of

total buyer activity has increased over the recent period, driven by a
continued expansion of available funding and number of participants in
the market.

Corporates were once again the most active buyers, with 90%
of acquirers being classified as corporate M&A deals and 10% Top corporate acquirers –
as IM or private equity deals. The dominance of corporate 18 months to 30 June 2020
buyers supports the strategic appetite of these organisations Rank Corporate acquirer No. of
to acquire growth. deals
The proportion of IM deals was marginally higher than the 1 Uniti Group Limited (ASX:UWL) 6
previous period where IMs comprised 9% of total M&A deal =2 Healthcare Australia Pty Ltd. 4
flow, which in total numbers increased from 132 to 137. The =2 Spirit Telecom Limited (ASX:ST1) 4
increase in IM activity represents a trend that we have been =2 AAM Investment Group 4
observing over recent reports given the volume of funding that
=2 Accenture plc (NYSE:ACN) 4
have been raised over the last few years across a diverse range
=2 Arthur J. Gallagher & Co. (NYSE:AJG) 4
of managers.
=3 I-MED Holdings Pty Limited 3
=3 Primewest Group Limited (ASX:PWG) 3
Top IM acquirers – 18 months to 30 June 2020 =3 Trinity Consultants, Inc. 3
=3 ASSA ABLOY AB 3
Rank IM acquirer No. of deals
=3 Spirit Telecom Limited 3
1 Quadrant Private Equity Pty Limited 7
=3 KPMG Australia 3
=2 CPE Capital Pty. Ltd. 4
=3 Endeavour Drinks Group 3
=2 Potentia Capital Pty Ltd 4
=3 Management Vehicle 3
=3 Pacific Equity Partners Pty Ltd. 3
=3 Morningstar Australasia Pty Limited 3
=3 Anacacia Capital Pty Ltd. 3
=3 Qube Holdings Limited 3
=3 Advent Capital Partners 3
=3 People Infrastructure Ltd (ASX:PPE) 3
=4 Quintet Yorkway 2
=4 Colington Capital Partners 2
Sources: S&P Capital IQ, Mergermarket, Grant Thornton.
=4 Arrowroot Capital 2
=4 Anchorage Capital Partners Pty Ltd. 2
=4 Allegro Funds Pty Ltd. 2
=4 Odyssey Private Equity Pty Limited 2
=4 Armitage Associates 2
=4 Next Capital Pty Ltd. 2
=4 Pemba Capital Partners 2
=4 Crescent Capital Partners 2

14 Dealtracker 2020
 29%
of total transaction
1% increase in total
were conducted by an deals from Asia
international acquirer Pacific buyers

Dealmakers by type Dealmakers by Region

The most active buyer of Australian targets amongst The global trend of cross-border activity is representative of the
the pool of corporate buyers was Uniti Group Limited appetite for global companies seeking growth where it can be
with 6 deals during the period. Uniti group is a found in a global environment of volatile economic regulation and
diversified provider of telecommunications services. political instability.
Uniti acquired several internet provides and phone
calls processing companies. International investment into Australia represented 29% of total
deal flow, which was marginally below the prior comparable
Five companies from different industries (healthcare, period with 31% (a decrease of 28 deals), representing a
communication, financial and professional services) continued robust trend of foreign investment into Australia.
logged 4 deals for the observed period and 11 entities However, many cross border deals have been slowed in recent
had 3 deals each across a diverse range of industries. times given the changes to the Foreign Investments Review Board
(FIRB) regime which has likely delayed deals seeking to complete
Of the IM dealmakers, as with the previous in H1 CY2020.
Dealtracker, Quadrant Private Equity has notable
standout for deal volume of new investments in Globally, Australia is regarded by corporates and IMs as a safe-
Australian targets. haven, unlike US, UK or European which are experiencing ongoing
political and economic instabilities. Globally, investor sentiment
Quadrant Private Equity expanded its portfolio with 7 is strong toward Australia’s ability to provide valuable and stable
acquisitions over the period, targeting family-owned investment opportunities despite the current FIRB requirements
businesses seeking succession options. Acquisitions which is mostly seen as a timing issue rather than a binary
were in diverse target sectors including ecommerce, decision on deal completion. However, should these restrictions
retail, consulting and business support services. continue, we are likely to see domestic acquirers having a
competitive advantage in processes which may lead to a further
Dealmakers by type reduction in overseas acquirer deals until these changes are
reversed.

Inbound acquirer regions

90% Corporate M&A deals

(1,263 deals)
10% IM deals (137 deals)
41% US & Canada (168 deals)
32% Europe (128 deals)
22% Asia Pacific (91 deals)
5% Others (19 deals)

Dealtracker 2020 15
 Deal sector composition by acquirer region

Consumer
discretionary
Consumer staples
All deals

14%

7%
US &
Canada

11%

4%
Europe

9%

5%
Asia
Pacific

15%

8%
$183m
Median enterprise value
Energy 2% -% 3% 3% Cross Border Inbound
Financials 8% 9% 4% 9%

$45m
Healthcare 6% 8% 3% 6%
Industrials 30% 28% 38% 29%
Information 23% 35% 34% 19%
technology
Materials 7% 5% 3% 9%
Teleco Services 1% - - 2% Median enterprise value
Utilities - - - - Domestic
Total 100% 100% 100% 100%

Domestic v cross border transactions US and Canadian buyers remain the largest volume of
(current period) offshore acquirers, with 41% of deals, which is consistent with
43% in the prior Dealtracker period.

Inbound acquisitions from the Asia Pacific region has

marginally increased to 22% of total deals compared with
69% Domestic (957 deals) 21% in the previous Dealtracker period. In regard to sector
29% Cross Border Inbound focus, Asia Pacific buyers continued the trend seen in recent
(406 deals) years by focusing on the Industrials sector, which comprise
2% Undisclosed (31 deals)
29% of Asia Pacific transactions.

Asian buyers continue to perceive the Australian mid-market as

an attractive source of opportunities to which they can deploy
their capabilities in home markets.

European buyers rank second with 32% of total inbound deals,

which is consistent with the proportion of European deals in
the previous Dealtracker period (32%). European buyers have
increased their focus on the Information Technology sector
Domestic v cross border transactions from 18% in the previous period to almost doubled 34% and
(prior comparable period) have marginally decreased their share in Industrials sector,
now amounting to 37% of total European transactions, down
from 39%. This is reflective of the continued trend for European
buyers to access the higher growth Asian growth markets and
acquire niche Intellectual Property that can be deployed in
67% Domestic (944 deals) Europe.
31% Cross Border (434 deals)
2% Undisclosed (25 deals)

16 Dealtracker 2020
Top 5 cross-border
inbound deals
Inbound deals: US and Canada – 18 months to 30 June 2020
Target company Target sector Buyer Buyer location Transaction
value $m
Information
MYOB Group Limited KKR & Co. Inc. (NYSE:KKR) United States 2,071.68
Technology

Aveo Group Real Estate Brookfield Financial Properties L.P. United States 2,066.79

Information
ClickSoftware Technologies Ltd. Salesforce.com, inc. (NYSE:CRM) United States 1,998.54
Technology
Communication
TEG Pty Limited Silver Lake United States 1,921.27
Services

Serendipity (WA) Pty Ltd Industrials Madison Dearborn Partners, LLC United States 725.00

Inbound deals: APAC – 18 months to 30 June 2020

Target company Target sector Buyer Buyer location Transaction
value $m

CUB Pty Ltd Consumer: Other Asahi Group Holdings, Ltd. Japan 16,000.00

DuluxGroup Limited Materials Nippon Paint Holdings Co., Ltd. (TSE:4612) Japan 4,333.49
First Sentier Investors Financial Services Mitsubishi UFJ Trust and Banking Corporation Japan 4,130.00
Manufacturing
Orora Limited (Australasian Fibre Business) Nippon Paper Industries Co., Ltd. Japan 1,720.00
(other)

China Mengniu Dairy Company Limited

Bellamy's Australia Limited Consumer Staples Hong Kong 1,425.59
(SEHK:2319)

Inbound deals: Europe – 18 months to 30 June 2020

Target company Target sector Buyer Buyer location Transaction
value $m
Information
GBST Holdings Limited FNZ (UK) Ltd United Kingdom 243.81
Technology
Agriculture,
Mackay Sugar Limited (70% Stake) Nordzucker AG Germany 211.00
Consumer: Foods
Kalbar Operations Pty Ltd Mining Appian Capital Advisory, LLP United Kingdom 144.00
Information
Ampac Technologies Pty Ltd Halma plc (LSE:HLMA) United Kingdom 135.00
Technology
Lasers and Ultrasound Business Segment of
Health Care Lumibird SA (ENXTPA:LBIRD) France 100.00
Ellex Medical Lasers Limited

Dealtracker 2020 17
Australia’s core M&A:
mid-market business

Small and medium sized businesses (SMEs) continued to be the

predominant acquisition targets with a high proportion of deals having
transaction values of less than $100 million.

SMEs This composition is reflective of the overall corporate landscape in Australia, The acquisition of Kounta Pty. Ltd by
with the majority of businesses being SMEs. Lightspeed POS Inc for $63 million –
20 October 2019
SMEs with strong growth prospects and a proven core business continue to represent
attractive acquisition targets, with an ability to obtain premium valuation multiples. A leading Omni channel point of sale
Transaction size continues not to be a barrier for foreign buyers, particularly as platform for over 51,000 customer
deal technology continues to be adopted through the increased take up of virtual locations worldwide, announced an
calls and virtual deal rooms. From our processes, overseas interest in the SME sector agreement to acquire Australia-based
remains strong even at deal values around $50 million. Examples of SME deals Kounta Holdings Pty Ltd, a rapidly
include Kounta Pty. Ltd. and Montessori Academy Group, summarised below, where growing, cloud-based POS solutions
international corporates bid strongly for specific strategic benefits of these assets. provider to small and medium-sized
businesses operating within the
Whilst the owners of private Australian SMEs are becoming increasingly mindful of
hospitality industry.
the need for succession planning as the baby boomer generation nears retirement
the slowdown that is likely to occur post pandemic will only add to the supply of
Management commented: “Combining
businesses that will be looking to be sold once conditions improve. This is likely to be
with Kounta will strengthen Lightspeed’s
in several years’ time once economic conditions stablise. However, if the Australian
resources to provide improved customer
economy can outperform other jurisdictions post pandemic, this could improve
experiences as it expands into the Asia-
demand for local businesses in the shorter term.
Pacific region, while tapping the talent
A snapshot of noteworthy SME deals of different ranges of size is provided below. and expertise needed to accelerate
Lightspeed’s mission of becoming
Acquirer Target Transaction value $m the leading global POS platform for
Kounta Pty Ltd Lightspeed POS Inc. 63.04 small and medium-sized businesses,
(TSX:LSPD) the backbone of vibrant cities and
Chalmers Limited Qube Logistics (Aust) Pty Ltd 61.98 communities throughout the world.”
Montessori Academy Group Holdings Greentown Service Group 57.35
Pty Ltd Investment Co. Ltd.

18 Dealtracker 2020
“ Foreign investors continue to target mid- market Australian
businesses which could become more attractive if Australia
can weather the global pandemic better than other markets
and therefore outperform when growth returns.”

Transaction size The acquisition of Chalmers Limited by Qube Logistics

for $62 million – 8 August 2019
2% Greater than $1 billion
(27 deals) Chalmers Limited provides road transportation, logistics,
warehousing, tank and container storage, and repair and
2% $500 – $999.9 million
(21 deals) sales services in Australia. It operates through Transport and
Containers segments.
6% $100 – $499.9 million
(81 deals)
Qube is Australia’s largest integrated provider of import and
39% Less than $100 million export logistics services with a market capitalisation in excess
(546 deals)
of $4.88 billion as at 30 June 2019.
52% Undisclosed (719 deals)
According to Qube, the Chalmers transport and logistics
operations, coupled with the company’s strategically located
property assets, are complementary to those of Qube
Logistics. The acquisition will allow Qube to progress its growth
plans while also providing an opportunity for significant cost
savings by integrating the Chalmers businesses to achieve
greater efficiencies and economies of scale.

The acquisition of Montessori Academy Group Holdings

Pty. Ltd by Greentown Service Group Investment Co.
Ltd. for $57.0 million – 5 July 2019
Montessori Academy Group Holdings Pty Ltd provides
preschool education and nursery services. The company
was founded in 2019 and is headquartered in Summer Hill,
Australia.

Greentown Education Investment Co. Ltd, a wholly-owned

subsidiary of HKSE-listed Greentown Service Group Co., Ltd. is
one of Asia’s high-quality players in the education sector, with
interests in K12 schools, kindergartens and early childhood
education.

Greentown Service Group Investment Co. Ltd. entered into the

share purchase agreement to acquire 56% stake in Montessori
Academy Group Holdings Pty Ltd.

Dealtracker 2020 19
Investment managers

The period covered by this report has seen a slight increase in IM deals
volumes by 4% up to 136 transactions since the prior Dealtracker period,
as significant amounts of funding remained available to IMs. Notably
though, H1 CY2020 experienced very low deal volumes.

“ The availability of capital

IM activity in Australia has remained strong despite global
macroeconomic uncertainties and tensions in a competitive IM
market. The number of IM deals in the current period increased has driven continued
to 136 deals, from 132 in the prior Dealtracker period.
strength in IM activity.
The strength of the current period was despite the tough
conditions in H1 CY2020 and was supported by the continued Such bidders are seeking
depth of funding that is being deployed by formal close-end
structures, family office and high-net-worth investor club
out the most attractive
structures. new areas of growth,
We expect IMs to continue to be cautious for the remainder particularly technology
of the year and remain focused on COVID19 positive
opportunities particularly in businesses favourable to enabled opportunities,
technology adoption.
despite domestic and
The next chart below shows the number of IM deals recorded in
each period specified.
global uncertainties.”

20 Dealtracker 2020
IM entries – Prior comparative Dealtracker periods

Dealtracker 7 136
Dealtracker 6 132
Dealtracker 5 88
Dealtracker 4 80
Dealtracker 3 49
Dealtracker 2 62

IM entries – Annual trends

2020 34
2019 102
2018 76
2017 81
2016 63
2015 48
2014 49
2013 32

IM entries – Quarterly & half yearly trends

Q2 2020 17 H1 2020
34 deals
Q1 2020 17
Q4 2019 32 H2 2019
65 deals
Q3 2019 33
Q2 2019 18 H1 2019
37 deals
Q1 2019 19
Q4 2018 12 H2 2018
36 deals
Q3 2018 24
Q2 2018 14 H1 2018
40 deals
Q1 2018 26
Q4 2017 32 H2 2017
56 deals
Q3 2017 24
Q2 2017 5 H1 2017
25 deals
Q1 2017 20
Q4 2016 20 H2 2016
47 deals
Q3 2016 27
Q2 2016 6 H1 2016
16 deals
Q1 2016 10
Q4 2015 10 H2 2015
22 deals
Q3 2015 12
Q2 2015 15 H1 2015
26 deals
Q1 2015 11
Q4 2014 17 H2 2014
32 deals
Q3 2014 15
Q2 2014 10 H1 2014
17 deals
Q1 2014 7
Q4 2013 11 H2 2013
19 deals
Q3 2013 8
Q2 2013 5 H1 2013
13 deals
Q1 2013 8

Dealtracker 2020 21
Valuation multiples
by target size

In line with previous Dealtracker reports, our analysis continues to show

that size is a significant determinate of value, with larger businesses
generally transacting at higher multiples than smaller businesses.

EBITDA is typically used as a measure of earnings for valuation Median trading multiple for companies in the revenue range
purposes as it reflects the financial performance of the business of $50 million to $100 million was 11.5x for the period, which
prior to taking into account how it is funded. is above the historical Dealtracker long term average of 8.2x.
Targets with revenue between $100 million and $200 million,
A multiple of EBITDA provides an enterprise value (EV) of the and those between $200 million and $500 million, obtained
business (i.e. the value of the business before deducting net median EV/EBITDA multiples of 8.9x and 8.2x respectively, while
debt). long term averages for these sectors are 9.1x and 9.2x.
The multiples included in the table opposite are based upon The historical high multiples for companies across the
the most recent financial statements prior to the transaction $50 million to $100 million revenue range can be partly
and accordingly, doesn’t necessarily factor in forecast profit attributable to a concentration of deals in the Healthcare
performance that is built into deal valuations. and Information Technology sectors that traded on high
multiples. In addition, the increased availability of capital
As has been the result over prior Dealtracker periods, larger
and the continued strong interest from oversees acquirers
businesses attracted greater valuation multiples than smaller
seeking growth up to 31 December 2019, continued to drive
businesses. This is because larger businesses typically have
competition in processes and therefore valuations.
greater stability and consistency in their earnings base as
compared to smaller businesses. The median multiple reported for the $200 million to $500
million range at 8.2x was down on recent Dealtrackers given
When assessing comparable deal multiples (particularly at the
the prominence of deals in the Consumer Discretionary and
lower end of the market) attention needs to be focused on the
Industrial sectors at comparatively lower multiples.
individual target growth prospects, inherent risks and strategic
premium available to the buyer pools. From our experience and Within the $500+ million revenue range, median EV/EBITDA
historical data, it remains our general view that SMEs’ historical multiples of 10.8x which was in line with the historical long term
EV/EBITDA multiples average in the range of 5.0x to 6.0x with average of 10.1x. The relatively high valuations in this revenue
one turn of multiple increase applicable to each of our size range are attributable to the significant proportion of mega-
brackets. transactions, with 11 of the 151 targets in this range (with
available deal multiples) having revenues greater than $1 billion.
Overall median trading EBITDA multiples in the report of 8.1x
were up from the last Dealtracker at 7.1x and above the long
term average observed as 7.8x.

The median trailing EBITDA multiples observed on businesses

with less than $50 million in revenues was in line with the
respective long-term average multiples for businesses of that
size.

22 Dealtracker 2020
“
Many SMEs have experienced
strong valuation multiples
through their inherent growth
opportunities, particularly
around their ability to scale
operations through a new
owner.”

Current Prior 2018 Prior 2017 Prior 2016 Prior 2014 Prior 2012 Prior 2011
Dealtracker Dealtracker Dealtracker Dealtracker Dealtracker Dealtracker Dealtracker Historical
No. of
Revenue range median median EV/ median median median EV/ median EV/ median Dealtracker
deals EV/EBITDA EBITDA wEV/EBITDA EV/EBITDA EBITDA EBITDA EV/EBITDA average
multiples multiples multiples multiples multiples multiples multiples

Less than $20 million 27 6.3x 5.1x 7.2x 5.5x 5.5x 4.9x 6.1x 5.8x
Between $20 million to 16 6.2x 6.6x 5.9x 8.8x 6.7x 6.1x 6.5x 6.7x
$50 million
Between $50 million to 11 11.5x 8.2x 8.9x 6.1x 8.0x 7.0x 7.9x 8.2x
$100 million
Between $100 million to 19 8.9x 12.6x 7.6x 10.8x 7.8x 8.7x 7.5x 9.1x
$200 million
Between $200 million 8 8.2x 13.2x 10.2x 8.5x 8.8x 7.0x 8.7x 9.2x
to $500 million
Over $500 million 14 10.8x 11.4x 11.9x 10.9x 7.1x 8.9x 9.8x 10.1x
Median (overall) 8.1x 7.1x 9.0x 7.8x 7.3x 7.5x 7.5x 7.8x
Total 95

Sources: S&P Capital IQ, Mergermarket, Grant Thornton

Historical Dealtracker median & average over all past

Dealtracker periods Prior 2011 Dealtracker median
EV/EBITDA multiples

14.0x Prior 2012 Dealtracker median

EV/EBITDA multiples
12.0x
Prior 2014 Dealtracker median
EV/EBITDA multiples
10.0x
Prior 2016 Dealtracker median
EV/EBITDA multiples
8.0x
Prior 2017 Dealtracker median
6.0x EV/EBITDA multiples

Prior 2018 Dealtracker median

4.0x EV/EBITDA multiples

2.0x Current Dealtracker median

EV/EBITDA multiples

.0x Average
Less than $20 Between $20 Between $50 Between $100 Between $200 Over $500 Median
million million to $50 million to $100 million to $200 million to $500 millon (overall)
millon millon millon millon

Dealtracker 2020 23
Valuation multiples
by target sector

The overall EV/EBITDA multiple observed during this Dealtracker period

was higher than in recent years with a median EBITDA multiple of 8.1x
across sectors. This was partly driven by the Healthcare and Industrial
sectors.

Transactions and valuation multiples per target sector (100 deals)

Current Prior 2017 Prior 2016

Median Median dealtracker dealtracker dealtracker
Median target
Industry No. of deals target EV target EBITDA median EV/ median EV/ median EV/
revenue ($m)
($m) ($m) EBITDA EBITDA EBITDA
multiples multiples multiples

Consumer discretionary 21 272 117 20 11.2x 10.6x 6.8x

Consumer staples 5 18 136 4 8.0x 11.4x 11.0x
Energy 4 120 129 11 7.5x 5.5x 11.4x
Financials 4 45 18 3 7.2x 8.0x 13.7x
Healthcare 8 92 62 9 11.4x 5.6x 4.6x
Industrials 36 38 42 6 8.0x 5.8x 9.3x
Information technology 12 46 17 11 8.0x 8.2x 9.0x
Materials 5 219 197 59 6.0x 4.7x 5.7x
Telecommunication services - - - - .0x 5.9x 11.1x
Utilities 5 315 197 51 7.1x 11.1x 16.8x
Median (all sectors) 83 63 10 8.1x 7.1x 9.0x
Total 100

The largest median observed valuation multiple was in the • The acquisition of Healthscope Limited by Brookfield
Healthcare sector with an EV/EBITDA multiple of 11.4x. It should Asset Management Inc for $5.7 billion at a valuation of
be noted that valuation data was available only for a small 14.3x EBITDA. Healthscope provides healthcare services in
number of deals relative to the total deals for the period, each Australia and New Zealand. The company operates through
of which attracted above average multiples. s. Hospitals Australia and Pathology New Zealand segments.

Notable overall Healthcare sector deals included the

• The acquisition of an 80.1% stake in MYOB Group Limited by
following:
KKR & Co., Inc. for $2 billion at a valuation of 18.5x. MYOB
• The acquisition of 85% of Navitas by consortium of Group Limited develops and publishes software in Australia
companies led by BGH Capital Fund for c.$2 billion and at and New Zealand. It provides its solution for SMEs and
a valuation of 27.9x EBITDA. Navitas is an education service advisers
provider.
Deals in Consumer Staples and Financials recorded overall
lower multiples than in the previous periods.

24 Dealtracker 2020
Notable deals in the Consumer Staples and Financials sectors included:

• The acquisition of 70% of Mackay Sugar Limited by • Trustee Services business is an Australia-based financial
Nordzucker AG, a Germany-based sugar producer for an services company that provides superannuation trustee,
estimated consideration of AUD 60m at a valuation of 26.7x administration, promotion and investment.
EBITDA.
• CPE Capital Pty. Ltd. acquired Unispace Global Pty Lt from
• Sargon Capital Pty Ltd acquired Trustee Services business its management and employees, for a consideration of AUD
of OneVue Holdings Limited for $45 million at a valuation of 400m at a valuation of 27.0x EBITDA. Unispace Global Pty
16.9x EBITDA. Sargon Capital Pty Ltd is an Australia-based Ltd is an Australia-based office outfitter and renovator.
provider of innovative pension products and services.

Valuation multiples observed in the current Dealtracker period for the

Healthcare, Industrials and Consumer Discretionary sectors were above
long-term averages. Valuation multiples in other sectors were equal to or
below long-term averages.

In relation to some specific drivers of industry valuations EV/EBITDA multiples by sector

movements, we noted the following:

• Information Technology: Information Technology related 7.1x

Utilities
deals have been a key focus of local and international 11.7x
buyers who continued to bid aggressively for businesses that Telecommunica- .0x
are taking advantage of the disruption facing every sector. It tion services 8.1x
was noted that M&A deal valuations were considerably below
6.0x
that achieved in the public markets (EV/EBITDA: 20x) which Materials
6.0x
is reflective of the earlier stage opportunities accessing these
markets as against more mature private opportunities. Information 8.0x
technology 8.0x

• Healthcare: this sector was the largest deviation from the 8.0x
Industrials
average EBITDA multiples of all sectors with an increase 7.1x
to 11.4x compared with a long term average of 7.4x. This
11.4x
increase occurred despite the relative drop in deal volumes Healthcare
7.4x
compared with the prior Dealtracker period. However, out
of these deals within this sector, half involved targets with 7.2x
Financials
revenues above $100 million. Typically larger deals tend to 9.9x
attract a higher valuation multiple which can be attributable 7.5x
Energy
to the higher reported median multiples for this sample of 9.2x
deals.
Consumer 8.0x
Staples 11.2x
• Utilities: the Utilities sector experienced the largest downward
deviation from historical ETBIDA average multiple, on low Consumer 11.2x
number of reported deals.
Discrentionary 9.3x

Current period EV/EBITDA multiple

Long-term average EV/EBITDA multiple

Dealtracker 2020 25
Domestic vs international
valuation multiples

As reported in prior Dealtracker periods, international acquirers have

continued to buy larger businesses and pay higher valuation multiples
than that achieved from domestic acquirers. This was reflected across
all industries where there were international acquirers.

Of the total 100 deals with valuation data, 68 involved domestic acquirers while 31 targets were acquired by buyers outside
of Australia. Of these foreign acquirers the composition between the USA, Europe and Asia was 8, 10 and 12 respectively,
with the remaining deal from Africa.

Foreign buyers were interested in larger targets and willing to pay more than their domestic counterparts. This was
exemplified through a median target enterprise value of $184 million and an EBITDA multiple of 9.1x (7.9x for the
corresponding domestic EBITDA multiples). The driving factor for the comparatively higher enterprise values for cross
border deals is the perceived relative stability of the Australian market, particularly from the perspective of buyers in the
USA which comprised the majority of inbound bidders. In addition, Australia has been considered as the key pathway for
global companies to tap into Asian growth markets.

The level of interest from overseas declined from 31% to 29% of total deals. One of the major reasons is a decline in the
number of deals in the first half CY2020 due to the challenges of doing cross border deals during the pandemic. Despite
this Grant Thornton corporate finance teams continue to see cross-border opportunities as buyer pools become truly
global even for SMEs.

26 Dealtracker 2020
 Multiples - Cross border inbound vs domestic

Current Prior 2018 Prior 2017 Prior 2016

Median Median Median
dealtracker dealtracker dealtracker dealtracker
No. of target target target
Dealmaker median median median median Average
deals EV revenue EBITDA
EV/EBITDA EV/EBITDA EV/EBITDA EV/EBITDA
($m) ($m) ($m)
multiples multiples multiples multiples

Cross border inbound 31 179 130 16 9.1x 10.3x 10.6x 9.1x 9.8x
Domestic 68 45 50 7 7.9x 6.5x 8.5x 7.4x 7.5x
Median (overall) 82 65 10 8.2x 7.1x 9.0x 7.8x 8.0x
Total 99

“
Multiples – cross border inbound v domestic
Australia continues to
attract foreign buyers.
9.8x
9.1x
7.9x
It has been historically
7.5x
perceived by international
bidders as a safe haven
for investments whilst
boasting relative economic
and political stability and
Cross border inbound Domestic
access to Asian growth
Current period median EV/EBITDA multiple
Long-term average EV/EBITDA multiple
markets. Should Australia
emerge from the pandemic
in better shape than other
global markets, this could
continue foreign interest in
Australian assets.”

Dealtracker 2020 27
Corporate M&A vs IM
valuation multiples

The median EBITDA multiple on IM deals has been observed to be higher

than that of corporate transactions over the current Dealtracker period.
This is predominantly as a result of the strong interest in the Industrials
sector.

The data collected for the 18 months through to 30 June In contrast, when compared to prior periods, the EBITDA
2020 report shows that IMs paid on average higher valuation valuations paid by Corporate bidders was similar to the long-
multiples than corporates. Note, the number of IM deals term average for median valuation multiples, with an overall
with available valuation multiples is significantly less median multiple of 8.0x for the period, above the long term
than corporate deals with available data. As a result, IM average of 7.8x.
transactions involving a significant premium become more
heavily weighted. Of these transactions by Corporate bidders which had
available EBITDA multiples, 32% involved targets in the
Based on this data set, the median EV/EBITDA multiple for Industrials sector. Of these, the median revenue and median
IM deals was 12.7x compared with the long-term average of transaction value was $63 million and $70 million, respectively.
10.8x. The significant skew in median multiple is likely due to This is indicative of the majority of targets in this data set
several larger deals occurring during the period, such as the belonging to a smaller size category. Such companies
acquisition of Unispace Global Pty Ltd by CPE Capital Pty Ltd typically attract lower valuation multiples, as consistent with
for 27.0x and acquisition of Navitas Ltd by Australian Super our other findings in this report. This is therefore the likely
Pty Ltd for 27.9x. It also talks to the weight of funds that is reason for the lower valuation multiples for the period in
supporting IMs. comparison to long term averages.

EV/EBITDA valuation multiples Median target EV ($m)

12.7x
10.8x

8.0x 826
7.8x

342
237 63
70 121 31 44 71 127

Corporate M&A deals IM deals Current 2017 2016 2014 2012

Dealtracker Dealtracker Dealtracker Dealtracker Dealtracker

Current period median EV/EBITDA multiple Investment Manager transactions

Long-term average median EV/EBITDA multiple Corporate transactions

28 Dealtracker 2020
 Current Prior 20178 Prior 2017 Prior 2016
Median
Median Median dealtracker dealtracker dealtracker dealtracker
No. of target
Dealmaker target reve- target EBIT- median median median median
deals EV
nue ($m) DA ($m) EV/EBITDA EV/EBITDA EV/EBITDA EV/EBITDA
($m)
multiples multiples multiples multiples

Corporate M&A deals 88 170 47 8 8.0x 6.8x 8.7x 8.3x

IM deals 12 342 156 37 12.7x 12.4x 11.0x 6.1x
Median (overall) 83 63 10 8.1x 7.1x 9.0x 7.8x
Total 100

Dealtracker 2020 29
 “ In contrast to the significant
fall and subsequent recovery
in public market valuations to
previous levels, private market
valuations improved over the
period which may reflect the
lack of post pandemic deal
volumes to date to represent a
downward shift in valuations.”

30 Dealtracker 2020
Share price performance
of listed companies
by target sector
Our analysis shows that the median trading multiple of all ASX listed
companies over the last 18 months to 30 June 2020 retracted slightly to
9.1x from 9.2x in December 2018, indicating softening equity markets in
H2 2020 since reaching a peak of 10.4x in December 2019.

Sectors with the highest valuation

multiples
Information technology Energy
The information technology sector has experienced strong
valuation growth up to an historical peak reached at 30 June The Utilities sector ranked second lowest in terms of relative
2020 of 20.0x EBITDA. The Information Technology sector remains EBITDA values observed and was materially below long terms
the sector category with the highest median trading multiple on averages.
the ASX. This is attributable to the high growth nature of many of
these participants and the markets appetite to pay for expected Movement in the S&P/ASX 200 – Jan 2010 to Dec 2020
future growth. Jan 2010 to Jan 2019

Healthcare 7,000

The Healthcare sector ranked second in terms of median

6,500
trading multiple of 11.8x for the observed period. The sector
reached a peak of 13.1x in December 2019 before declining 6,000
with the wider market post pandemic.
5,500
Sectors with lower multiples
5,000

Materials
4,500
The Materials sector remains the lowest valued sector however
did record an increase in valuations with the average multiple
4,000
for the last 18 months of 7.1x higher than the long term
average of 6.3x given improving commodity prices during the 3,500
period.
01/10 01/11 01/12 01/13 01/14 01/15 01/16 01/17 01/18 01/19 01/20

Sources: Standard & Poor’s Capital IQ. Grant Thornton Australia analysis.

Dealtracker 2020 31
The decline in the overall trading multiple of ASX listed companies is
the result of significant variances across economic sectors from their
respective long-term averages, with the largest deviation being a
deterioration in the Utilities sector.

Median EV/EBITDA multiples observed on the ASX by sector

Median EV/
31/12/12 30/06/13 31/12/13 30/06/14 31/12/14 30/06/15 31/12/15 30/06/16 31/12/16 30/06/17 31/12/17 30/06/18 31/12/18 30/06/19 31/12/19 30/06/20 Average Ave 3p
EBITDA as at

Consumer
7.6 7.5 9.6 9.7 10.2 10.2 10.6 10.0 10.8 9.4 9.9 9.5 9.3 9.7 10.8 9.3 9.1 9.9
discretionary

Consumer
8.7 9.8 10.2 10.2 10.8 10.8 10.3 10.3 11.4 10.5 11.2 11.6 10.5 10.7 12.2 11.1 10.2 11.3
staples

Energy 7.7 3.8 5.5 6.4 4.3 4.2 5.1 5.2 6.6 5.4 6.8 8.5 7.8 7.3 7.0 5.0 6.8 6.4
Financials 10.6 12.7 13.1 13.2 12.5 12.7 12.0 9.9 11.4 11.4 13.0 11.3 10.7 12.0 11.3 8.7 11.6 10.6
Healthcare 11.2 12.8 16.8 15.0 13.1 12.6 11.8 11.5 11.1 10.9 11.7 12.3 10.5 11.7 13.1 10.7 11.4 11.8
Industrials 5.7 5.5 6.4 7.0 6.3 6.3 6.9 6.4 8.0 9.0 9.2 8.5 7.9 8.4 9.6 8.8 7.4 8.9
Information
8.6 9.3 12.0 12.5 12.6 12.6 13.8 12.0 14.3 12.8 17.0 15.3 11.2 15.3 18.1 20.0 11.9 17.8
technology

Materials 5.1 2.2 3.5 7.1 4.7 4.7 4.4 5.9 6.2 5.9 7.7 7.1 6.5 6.8 7.6 6.8 6.3 7.1
Telecos 9.8 10.7 10.8 9.5 9.2 9.2 15.6 11.7 9.1 9.1 9.3 8.6 8.6 10.3 10.2 10.3 9.1 10.3
Utilities 11.1 9.5 8.7 9.1 9.6 9.6 11.6 11.4 11.2 9.9 10.3 8.8 7.5 11.6 13.7 9.4 10.4 11.6
Overall 7.6 7.0 8.2 9.5 8.9 8.8 8.8 8.9 10.3 9.8 10.3 9.8 9.2 9.8 10.4 9.1 8.9 9.8

Source: Standard & Poor’s Capital IQ.

32 Dealtracker 2020
The median EBITDA multiples for each sector have continued Four year revenue compound annual growth rate
to fluctuate materially from their respective historical average (CAGR) forecast by sector
multiples (from 31 December 2010 to 30 June 2020 or 40
quarters). An overall peak was hit for 2H 2019 matching the
equivalent high experienced in 2H 2017, at an overall median Wholesaling

EV/EBITDA multiple of 10.4x across all sectors. Retail trade

Agricultural
The largest deferential was experienced in the Energy and Manufacturing

Financials sectors. The trailing median EV/EBITDA multiple of Transport

5.0x for the Energy sector was well below its historical average Retail trade
Government
of 6.8x, or a 26% discount when compared to the sector’s
Mining
historical average since 31 December 2010. For the Financial
Finance
sector the drop was equal to 25% - from average of 11.6x to
Education
trailing 8.7x.
Utilities
Construction
The Information Technology sector has experienced the greatest
Health
increase in valuations, with the trailing median EV/EBITDA
Finance
multiple of 20.0x exceeding its historical average of 11.9x,
Community
or a 69% premium when compared to the sector’s historical Communication & Technology
average since 31 December 2010. The tendency to value these Personal & other
companies with reference to revenue multiples given their
1.5% 3.5% 5.5%
annuity revenue streams is driving some of these valuations.
Four year CAGR

Based on forecast CAGR by sector (source: IBISWorld, Grant

Thornton analysis), the ‘Communication & Technology’ and
‘Personal and Other’ sectors are expected to experience the
strongest market growth. This is in line with the trend in recent
deal activity and valuations reported, particularly with regards
to the high level of deal activity in the Information Technology
sector.

Median EV/EBITDA trading multiples by sector

9.1x 10.2x 6.8x 11.6x 11.4x 7.4x 11.9x 6.3x 9.1x 10.4x

9.3x 11.1x 5.0x 8.7x 10.7x 8.8x 20.0x 6.8x 10.3x 9.4x

Consumer Consumer Information

Energy Financials Healthcare Industrials Materials Telecos Utilities
discretionary staples technology

Sector median EV/EBITDA multiples as at 30 June 2020 Sector long-term average (June 2007 to 30 June 2020)

Dealtracker 2020 33
IPO activity in Australia

In line with the market conditions, IPO activity comparatively

dampened in the 18 months to June 2020 with minimal activity
since the commencement of the pandemic.

Comment

• The CY2019 and CY2020 periods experienced weaker • The whole CY2019 experienced a decrease in the number
primary capital raising conditions than previous periods. of IPOs undertaken with total number of 50 deals, which is
Cumulatively, through both IPOs and secondary capital 41% lower than CY2018 with total of 85 deals. Slow start of
raisings, during CY2019 a total of $60 billion was raised. The the 2019 - 4 deals in Q1- was offset by the higher number
cumulative amount raised for the first half of CY2020 was of 25 deals in the last quarter. The first half of CY2020
equal to $53 billion which was boosted by the significant represented 7 deals which is the lowest number of IPOs for
secondary raisings undertaken at the commencement of the the entire observation history.
pandemic and the TPG merger and relisting amounting to
$16.6 billion. Excluding the TPG deal, H1 CY2020 IPOs were • The value of listings in CY2019 has decreased to A$2.4
circa $1 billion which is the lowest level in the history of this billion, materially down from CY2018 with $5.7 billion.
publication.
• The average IPO value has decreased to $49 million in
• The proceeds of IPO activity through CY2019 totaled $14 CY2019 from $67 million in CY2018. However, this amount is
billion, compared to $47 billion in CY2018 and $16 billion in higher than the CY2017 average amount of $36 million.
CY2017 – a decrease of 69% and 10% respectively.

• Whilst the H1 CY 2020 period experienced limited IPO

activity, as at the publication of this report, the market in H2
CY2020 is considerably stronger with many issuers looking
to list prior to year-end.

34 Dealtracker 2020
Initial & Secondary Capital Raisings (CY2008 to CY2020)
Funds raised ($b)
106 104
90

62 58 60
64
57 53
56 53 55
48 57
42
60 99 31 33 28 35 33 41 46
35 35
47
25 33
15 24 29 21 16 14
2 8 7 14

2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020

IPO
Secondary capital

Quarterly IPO trends (FY2015 to FY 2020)

Number of IPOs
35 36
33 34

28
25 26
25
23 23
20 21
19 19
16 17
15 14
11 12

7
4 3 4

Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2
2014 2014 2015 2015 2015 2015 2016 2016 2016 2016 2017 2017 2017 2017 2018 2018 2018 2018 2019 2019 2019 2019 2020 2020

Quarterly IPO trends (FY2015 TO FY2020)

Average size ($m)

273

190

134 131

96 103 99
88
78
69 66
50 58
47 38 44 41
34
24
15 7 11 15 15

Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2
2014 2014 2015 2015 2015 2015 2016 2016 2016 2016 2017 2017 2017 2017 2018 2018 2018 2018 2019 2019 2019 2019 2020 2020

Quarterly IPO trends (FY2015 - FY2020)

Offering size ($m)

9,010

3,615 3,398
2,736
2,144 2,029 1,922 2,155 1,804
1,303 1,287 1,150
826 863 1,028
584 620 695
160 187 206 94 45 60

Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2
2014 2014 2015 2015 2015 2015 2016 2016 2016 2016 2017 2017 2017 2017 2018 2018 2018 2018 2019 2019 2019 2019 2020 2020

Dealtracker 2020 35
Over the 18 months to 30 June 2020 a total of 57 new companies listed
on the ASX, decreasing significantly from 134 in the preceding 18 month
period. The difference in total value of funds raised was proportional,
decreasing by 68% since prior period.

IPOs by size range (1 Jan 2019 to 30 June 2020) IPOs by size range (1 Jul 2014 to 31 Dec 2015)

No. of Offering % of No. of Offering % of

Range Range
IPOs size ($m) total IPOs size ($m) total

Less than $10 million 18 106 4.2% Less than $10 million 40 211 1.1%
Between $10 million to $50 million 26 706 27.8% Between $10 million to $50 million 42 1,044 5.3%
Between $50 million to $100 million 5 340 13.4% Between $50 million to $100 million 19 1,380 7.0%
Between $100 million to $500 million 8 1,388 54.6% Between $100 million to $500 million 29 6,162 31.3%
Over $500 million - - - Over $500 million 6 10,890 55.3%
Total 57 2,541 100.0% Total 136 19,687 100%

IPOs by size range (1 Jan 2017 to 31 Dec 2018)

Comment
No. of Offering % of
Range
IPOs size ($m) total
• The total number of listings reflected a significant decrease
Less than $10 million 76 438 5.6% in the volume of 58% compared to the previous Dealtracker
Between $10 million to $50 million 36 622 7.9% period, with 77 less listings in this Dealtracker period from the
Between $50 million to $100 million 9 566 7.2%
134 recorded in the previous corresponding period.

Between $100 million to $500 million 9 1,751 22.3%

• The total funds raised on initial offerings declined 68% to
Over $500 million 4 4,473 57.0%
$2.54 billion. The funds raised were dominated by offer sizes
Total 134 7,849 100%
between $100 and $500 million which accounted for 54.6%
of the total funds raised in this Dealtracker period.

IPOs by size range (1 Jan 2016 to 30 June 2017) • Comparing the previous three Dealtracker periods to this
No. of Offering % of report, the average offering size has reduced in almost all
Range
IPOs size ($m) total categories. The only size category which had an increase in
Less than $10 million 69 389 4.7% the average size was ‘Between $10m and $50m’ where size
grew from $622 million to $706 million.
Between $10 million to $50 million 48 950 11.6%
Between $50 million to $100 million 9 586 7.1%
Between $100 million to $500 million 11 2,640 32.2%
Over $500 million 5 3,632 44.3%
Total 142 8,197 100%

36 Dealtracker 2020
IPO size by sector

Comment Number of IPOs by sector for 18 months to 30 June

2020
• Almost every sector has experienced a reduction in 3
the number of deals for the observed period with Utilities 2
-
the only exceptions being in the Financials and
1
Healthcare sectors. Telecommunication
2
services
1
• The Information Technology sector has experienced 27
Materials 50
a decline in terms of listing activity, falling from 23 7
listings in the prior Dealtracker period to 14 in the Information
31
current period. This can partly be attributed to the technology
23
14
change in listing rule requirements that has made 13
it more difficult to pursue some early state listing Industrials 13
processes. 6
18
Healthcare 13
• The materials sector experienced the largest decline 12
in the number of deals – from 50 in the previous 21
Financials 10
period to 7 in the current. 10
1
Energy 4
• Information technology has now overtaken
1
Financials in terms of IPO value by sector, 13
characterised by several large IPOs in this Consumer staples 8
Dealtracker period. 3
14
Consumer
9
discretionary
3

18 months ending 31 Jun 2017

18 months ending 31 Dec 2018
18 months ending 30 Jun 2020

IPO value by sector for 18 months to 30 June 2020

7.% Consumer discretionary

3% Consumer staples
0% Energy
30% Financials
8% Healthcare
4% Industrials
42% Information technology
2% Materials
1% Telecommunication services
0% Utilities

Dealtracker 2020 37
Top IPOs in each sector
18 months to 30 June 2020

Industrials Materials
Mader Group Limited Terragen Holdings Limited
Issuer Issuer
(ASX:MAD) (ASX:TGH)

Offer size $49.8 million Offer size $20.0 million

IPO price $1.0 IPO price $0.3

Price at 30 Jun 2018 $0.8 Price at 30 Jun 2018 $0.2

Price change -30%

Price change -22%

Energy Consumer discretionary

Issuer Tubi Limited (ASX:2BE) Carbon Revolution Limited
Issuer
(ASX:CBR)
Offer size $5.8 million
Offer size $90.2 million
IPO price $0.2
IPO price $2.6
Price at 30 Jun 2018 $0.8
Price at 30 Jun 2018 $1.8
Price change -22%
Price change -29%

Consumer staples Information technology

Issuer Nuchev Limited (ASX:NUC) Tyro Payments Limited (ASX-
Issuer
:TYR)
Offer size $48.7 million
Offer size $287.1 million
IPO price $2.6
IPO price $2.8
Price at 30 Jun 2018 $2.3
Price at 30 Jun 2018 $3.5
Price change -12%
Price change +27%

Financials Telecommunication services

Home Consortium Limited Issuer OptiComm Ltd (ASX:OPC)
Issuer
(ASX:HMC)
Offer size $42.4 million
Offer size $325.0 million
IPO price $2.0
IPO price $3.40
Price at 30 Jun 2018 $5.1
Price at 30 Jun 2018 $3.0
Price change +155%
Price change -10%

Health care
Aroa Biosurgery Limited
Issuer
(ASX:ARX)

Offer size $45 million

IPO price $0.8

Price at 30 Jun 2018 $0.0

Price change -100%

38 Dealtracker 2020
Listing multiples and
immediate price returns
by target sector
In the 18 months to 30 June 2020 a total of A$16 billion was raised
from new listings on the ASX, with the 10 largest listings contributing
approximately 10% of the total equity raised during this period. The
largest listing during the 18 month period was Home Consortium Limited
(ASX:HMC) that raised $325 million.

IPO multiples of the ten largest IPOs (in the 18 months to 30 June 2020)

FY2019F
Listing Offer size Market Cap CY2020F EV/EBITDA
Company Industry
Date (A$m) (A$m) EBITDA (forecast
multiple)

Home Consortium Limited (ASX:HMC) 23/09/19 Financials 325 663 41 31.3

Tyro Payments Limited (ASX:TYR) 18/11/19 Information Tech- 287 1,366 (4) N/A
nology
FINEOS Corporation Holdings plc (ASX- 26/07/19 Information Tech- 211 661 15 46.0
:FCL) nology
Life360, Inc. (ASX:360) 17/04/19 Information Tech- 145 689 (17) N/A
nology
Nitro Software Limited (ASX:NTO) 21/11/19 Information Tech- 110 325 (5) N/A
nology
Prospa Group Limited (ASX:PGL) 16/05/19 Financials 110 721 (13) N/A
Primewest Group Limited (ASX:PWG) 14/10/19 Financials 100 349 24 11.1
Limeade, Inc. (ASX:LME) 02/12/19 Information Tech- 100 453 (5) N/A
nology
Carbon Revolution Limited (ASX:CBR) 01/11/19 Consumer Discre- 90 331 (12) N/A
tionary
PointsBet Holdings Limited (ASX:PBH) 16/05/19 Consumer Discre- 75 220 (51) N/A
tionary
Total 1,553 5,778
Average 155 578 (3) 29.5x

Dealtracker 2020 39
Six of the top 10 listings during the 18 months ending 30 IPO performance of the ten largest IPO’s to 30 June
June 2020 have experienced declines in their post-listing 2020
share prices. The largest underperformer was Prospa
ASX:PBH 165%
Group Limited (ASX:PGL) with a share price deterioration
of 75% since its IPO on 16 May 2019. ASX:CBR -29%

Likewise, Life360, Inc. (ASX:360) had similarly experienced ASX:LME -22%

a deterioration in share price since listing. The software
ASX:PWG 6%
company has dropped in share price by 57% since IPO on
17 April 2019. ASX:PGL -75%

The top performer in terms of share price was Points Bet ASX:NTO -15%
Holdings Limited (ASX:PBH), more than doubling in value
ASX:360 -57%
since listing on 16 May 2019. This company provides online
bookmaker service and has benefited from the COVID -19 ASX:FCL 56%
trading conditions.
ASX:TYR 27%

ASX:HMC -10%

Share price performance

40 Dealtracker 2020
Private equity story

The performance of the of private equity backed floats has come under
recent pressure with the wider market volatility however long term value has
continued to be created by the sector with 25% of IPOs doubling in value
since listing and 39% currently above their listing price.

Private Equity backed IPOs performance to 30 June Months since listing

2020

Exto Partners 54
BuildingIQ, Inc (ASX:BIQ) -100%
Propel Investments 72
The PAS Group Limited (ASX:PGR) -95%
Quadrant 72
Isentia Group Limited (ASX:ISD) -93%
Banksia Capital 73
Pioneer Credit Limited (ASX:PNC) -82%
Coronado Group LLC 20
Coronado Global Resources Inc (ASX:CRN) -77%
Quadrant Private Equity Pty Limited 66
Estia Health Limited (ASX:EHE) -73%
VCDE Venture Partners 59
amaysim Australia Limited (ASX:AYS) -67%
Insight Venture Partners 71
3P Learning Limited (ASX:3PL) -66% Wolseley Private Equity 54
IVE Group Limited (ASX:IGL) -60% Quadrant Private Equity Pty Limited 84
Virtus Health Limited (ASX:VRT) -50% Ironbridge 62
Eclipx Group Limited (ASX:ECX) -46% Bailador Technology Investments 20
Straker Translations Limited (ASX:STG) -42% Intermediate Capital Group 56
Link Administration Holdings Limited (ASX:LNK) -36% Accel Partners 80
OFX Group Limited (ASX:OFX) -30% Catalyst Investment Managers Pty Ltd 60
Adairs Limited (ASX:ADH) -26% Battery Ventures 6.0
Nitro Software Limited (ASX:NTO) -15% Champ Venture 75
SG Fleet Group Limited(ASX:SGF) -14% Archer Capital Pty Ltd 50
MotorCycle Holdings Limited (ASX:MTO) -9% Pemba Capital Partners 14
ReadyTech Holdings Limited (ASX:RDY) -7% TPG Asia VI SF Pte. Ltd. 43
Inghams Group Limited (ASX:ING) 2% Paine Schwartz Partners, LLC 59
Costa Group Holdings Limited (SAX:CGC) 29% Macquarie Group Limited 61
Australian Finance Group Limited (ASX:AFG) 43% Macquarie Equity Partners 55
Hazer Group Limited (ASX:HZR) 83% Advent Funds 56
Integral Diagnostics Limited (ASX:IDX) 104% Traditional Investment Manager 56
Baby Bunting Group Limited (ASX:BBN) 130% Magnum Capital 55
BWX Limited (ASX:BWX) 134% Ironbridge Capital Pty Ltd 43
Bravura Solutions Limited (ASX:BVS) 210% Quadrant 74
Bapcor Limited (ASX:BAP) 224% Pacific Equity Partners 106
Collins Food Limited (ASX:CKF) 277% Macquarie Capital Group 54
Temple & Webster Group Limited (ASX:TPW) 474% Anacacia 65
Appen Limited (ASX:APX) 6684%
Months since listing
Performance to 30 June 2020

Dealtracker 2020 41
42 Dealtracker 2020
Working together

“ In these unprecedented market

conditions, organisations’ ultimate
success depends on their ability to
deal with trends as they emerge and
seize those opportunities in front
of their competitors. Our team’s
constant focus is to help these
organisations unlock their potential
for growth through market leading
insights and expertise.”
Paul Gooley, National Head of Corporate Finance

Dealtracker 2020 43
Depth of experience

Are you looking at a merger, making an acquisition, disposing of a

business, undertaking a future public share offering or raising finance?
Whatever your strategic objectives, Grant Thornton Australia Limited
can help you achieve them and increase your shareholders’ wealth.

Emergence

Capital
Trust
markets =

Credibility Responsibility Intimacy

Industry
specialisation M&A

Relates to
Relates to Relates to
Development

our emotions:
our words and our actions
do people feel
Maturity

is revealed in our and is revealed

Solutions credentials
and honesty
by keeping our
promises
safe talking
about difficult
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Self-orientation
Transaction Project
Relates to our caring and is revealed in
advisory finance
services our focus – ourselves or the group

Valuations

Growth

44 Dealtracker 2020
Corporate Finance
services

Our success is built on the importance we place on developing deep,

long-lasting relationships, both with our clients and with third parties
such as private equity houses, banks, other financial intermediaries,
lawyers and government bodies. The strength of our partnerships and
our multidisciplined team allows us to provide a rapid response, tailored
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1 In an ever changing market 3 In today’s market, knowing Working with our clients
Transaction advisory services
environment, it is important your business environment has given our team
to effectively manage costs and market is critical. It extensive experience in Acquisition due diligence
and maximise returns. Our is therefore important all aspects of corporate Vendor due diligence
team acts as a strategic to be able to trust that finance. Tax due diligence
advisor and is committed to your advisor has strong
Commercial due diligence
taking the time to genuinely industry skills and is aware
listen to your individual of current issues relevant Merger & acquisition services Investigating accountants’
needs. This enables us to to you, your customers Mergers & acquisitions report
present you with solutions and your stakeholders. Buy/sell side lead advisory Forecast reviews
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Private equity transactions Management assessment
ensure your shareholder in providing corporate
wealth is maximised. advisory services for both MBIs/MBOs Data room services
large and medium size Cross border transactions Pre-lend reviews
2 Clients expect the highest organisations we have Industry consolidation
level of service and value the ability to share best
Debt refinancing Valuations
for money from their practice solutions and
financial advisor. Grant industry insights with you. ASX/AIM listings Independent valuations
Thornton Australia firmly Corporate structuring Independent expert reports
believes that we will exceed 4 As one of Australia’s Capital raisings Majority/minority interests
your expectations. By leading advisors, we work
Information memorandum Purchase price allocations
adopting a truly Partner- with dynamic, growing
preparation
led approach we set organisations to unlock Employee share and option
ourselves apart from other their potential for growth. plans
firms whilst maintaining You will benefit from Financial modelling Hybrid financial instruments
competitive and sustainable working with your local
Financial model construction Intangible assets
fee arrangements. Our team who understand the
clients appreciate the issues you face and is able Financial model review Disputes and litigation
proactive and commercial to draw upon the expertise support
Project analysis
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Project feasibility
are tailored to meet their industry specialist Tax consolidation
Project financing
individual needs today and and technical experts
in the future. throughout Australia and
internationally.

Dealtracker 2020 45
Our services

Mergers & acquisitions

Undertaking a merger, acquisition, or divestment can be a watershed

event in a company’s evolution. Grant Thornton Australia’s Mergers &
Acquisitions (M&A) team are highly skilled and entrepreneurial and have
the experience and expertise you need.

To assist our clients with their ambitions, Grant Thornton

Australia’s M&A team can provide an independent view and Our M&A team
insight into the risks and opportunities available for companies
Will provide hands-on strategy and transaction execution advice
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We understand our clients are looking for more than just an Will provide overall process and transaction management and
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Will provide a seamless suite of advisory services in a co-ordinated
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We work closely with our Tax, Assurance and other Specialist
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Our team brings together multidisciplinary financial Seamless support from Grant Thornton brings real value
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cross-border transaction capabilities.

46 Dealtracker 2020
Our services

Transaction advisory
services

Whether you are acquiring, divesting or considering an initial public

offering, our transaction advisory team will identify and resolve key
business issues through our rigorous risk and business analysis process.

Tailoring a reporting method to suit your preferred medium and

help you make informed decisions, you will receive balanced Our services have been developed to meet the needs of
and objective advice, giving you insight and confidence around the middle to large market sectors and include:
the numbers and key questions in respect of your transaction.
Acquisition financial and tax due diligence

Our national team of advisors is experienced, capable and Vendor financial and tax due diligence
hands on. We work to develop a real understanding of our
Agreed upon procedures reports
clients’ businesses and requirements, with partner-led service
and long-term working relationships. Investigating accountant reports

Reporting accountant reports (Alternative Investment Market)

We also offer cross-border transaction experience and depth.
Working with transaction advisory teams in other countries via Forecast modelling and review
our international network enables seamless delivery of cross
Pre-acquisition/disposal planning
border opportunities.
Pre bid analysis and valuation
Operational Deal Services Tax planning and structuring

Our Operational Deal Services (ODS) team provides Sell side preparation
practical advice to ensure the greatest possible outcome and
Data room facilitation and management
value from business transactions.
Transaction accounting advice including purchase price allocation
We work with you through all stages of the deal to maximise
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deal value and performance, through a robust approach to
strategic planning, stakeholder engagement, value mapping Transaction project management
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Completion accounts review and comments on sale agreement

Operational Deal Services, including post acquisition integration and

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Dealtracker 2020 47
Our services

Valuation services

Grant Thornton Australia’s valuation team provides clients access

to dedicated practitioners with in-depth expertise in the valuation of
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Valuation services include:

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48 Dealtracker 2020
Our services

Financial modelling
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Financial modelling is the process of forecasting performance of

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The central aim of all financial modelling is decision making or valuation
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In an environment of increasing corporate governance Developing financial models

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reporting. that can be used for a wide variety of situations to enhance the
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Financial models are commonly required when
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Improving existing decision making processes • Scenario analysis

Financing/refinancing • Forecasting

Business expansion • Cash flow management

Improving efficiency in the finance team

Acquisitions of businesses Key decision making tool

Sales and divestments A financial model is not seen as a piece of software but rather
Public offerings (IPO) as a key decision making tool that has the ability to make or
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Supporting contract tender processes construction. Likewise our financial model review process is
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Are well summarised, with visual outputs and dashboards

Dealtracker 2020 49
 Methodology
In preparing this publication, we have relied upon the following key sources of
information, including: Standard & Poor’s Capital IQ, the Australian Securities
Exchange, MergerMarket, IBISWorld, company announcements and other
publicly available information. We have considered transactions during the
period between

1 July 2017 to 30 June 2020 where the target company’s primary sector was
resident in Australia and the acquirer gained control of the company.

Our analysis is based on the assumption that the information derived from the
different sources mentioned above are correct and that no material information
is missing. Whilst all reasonable actions have been observed to ensure that the
information in this report is not false or misleading, Grant Thornton does not
accept any liability for damage incurred as a result of facts or deficiencies in
this report. Conclusions and judgements reflect our assessment at the time of
the publication’s completion.

50 Dealtracker 2020
About us

We’re an organisation of independent assurance, tax and advisory

firms, made up of over 50,000 people in 135 countries. And we’re here to
help dynamic organisations unlock their potential for growth.

For more than 100 years, we have helped dynamic organisations realise their strategic ambitions. Whether you’re looking to
finance growth, manage risk and regulation, optimise your operations or realise stakeholder value, we can help you.

Grant Thornton Australia has more than 1,300 people working in offices in Adelaide, Brisbane, Cairns, Melbourne, Perth and
Sydney. We’ve got scale, combined with local market understanding. That means we’re everywhere you are, as well as where you
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Snapshot Our services

Audit & Assurance
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Superannuation
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worldwide revenu people globally offices globally countries Debt & payment advisory
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Dealtracker 2020 51
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