How does one find deal multiples for a certain transaction?
Trying to research a deal for a potential superday and I'm having some issues finding deal multiples. I've checked each party's websites, CapIQ and still nothing.
I have a FT Professional, and a WSJ subscription if that helps.
Do I just have to look at comps and assume a spread with them when being interviewed? Any help would be appreciated.
Finding deal multiples for a specific transaction can indeed be challenging, especially if the deal involves private companies or if the transaction details are not publicly disclosed. Here are some strategies you can employ, leveraging the resources you mentioned and general best practices:
Review Financial News and Analysis: Utilize your Financial Times (FT) Professional and Wall Street Journal (WSJ) subscriptions. These publications often cover major transactions and might provide insights into the deal multiples, especially for high-profile transactions. Look for articles and analysis pieces published around the time of the announcement or closure of the deal.
Company Press Releases: While you've checked each party's websites, ensure you've reviewed their press releases thoroughly. Sometimes, companies disclose financial details of transactions in their press releases or during investor calls that follow the announcement of a deal.
CapIQ: You've mentioned checking CapIQ, which is a great resource. Ensure you've explored all sections, including the transaction details, analyst reports, and any available valuation analysis. Sometimes, deal multiples can be inferred from related financial metrics provided.
Industry Reports and Analysis: Look for industry-specific reports or analysis that might cover the transaction. Industry publications or research firms often analyze significant deals within their sector, providing estimated multiples based on available information.
Networking and Industry Contacts: If you have connections within the industry or with professionals who might have insights into the deal, consider reaching out to them. They might be able to provide or point you towards the information you're seeking.
Educated Assumptions Based on Comps: If all else fails, looking at comparable transactions (comps) within the same industry and around the same period can give you a ballpark figure. You can explain your methodology during the interview, stating that due to the lack of publicly available information, you've estimated the deal multiples based on comps. This approach shows your analytical skills and understanding of the industry.
Remember, it's crucial to be transparent about your methodology and the assumptions you've made when discussing your findings during an interview. Demonstrating your research process and critical thinking can be just as valuable as presenting the exact numbers.
Sources: Lunch & Learn -Ins and Outs of Multifamily, "Walk me Through a Deal You Worked on" Interview Question, Got this task during an Private Equity internship interview, how to handle it?, Notes for Technical Interview Questions, Notes for Technical Interview Questions
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