Private Market multiple compression

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June 30, 2022

by a searcher from INSEAD in Toronto, ON, Canada

Given the on-going correction in the stock market, wondering whether folks are seeing the start of PE, SDE or other transaction multiples compression in private market deals or even beginning to use lower valuations in public markets as precedents for negotiating lower transaction multiples? Thoughts appreciated!

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Reply by a searcher
from The University of Chicago in Fort Lauderdale, FL, USA
The PE firms are understandably being more cautious and will be looking for lower prices, whether the seller is motivated enough to comply is yet to be seen, at least on the deals we are working on.
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Reply by an investor
from Columbia University in McLean, VA, USA
I have not seen any compression in small business services companies... multiples seem as strong as ever.
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