Radio Transaction Multiples Fall Post-GFC

Research shows that the multiples being paid for Australian radio assets have fallen considerably in the post-GFC environment. The research, undertaken by BridgePoint Group Advisory, analysed transaction multiples across more than a decade of merger and acquisition transactions involving Australian radio assets.

David Kells, Director of BridgePoint Group Advisory told Radio Today:

“As with most industry sectors, there was a pause in transaction activity between 2008 and 2010. Transaction activity has picked up again since 2011; however, transaction multiples have reduced considerably compared to those in the pre-GFC era.

"While pre-GFC transactions averaged around 12 times EBITDA, the post-GFC multiples are averaging between 7 and 8 times EBITDA. The size and quality of the asset also plays a role in valuation, with smaller or less strategic assets trading at a discount to larger assets with exposure to key markets.”

Radio Today's Brad March, former Group Managing Director for the Austereo Network, Managing Director of Marchmedia and adviser to BridgePoint Group Advisory said:

“There’s no doubt that these lower multiples are a reflection of the shifting media landscape as well as the availability of capital to fund acquisitions. However, it is encouraging to see the recent pick-up in transaction activity in the radio sector, which demonstrates that buyers and sellers of radio assets are again finding common ground in terms of value.”

For more information visit BridgePoint Group Advisory.