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A stock photo of Canadian paper bills.
A stock photo of Canadian paper bills.

Takeover multiples, cash deals show a big jump

Thinking of buying a Canadian company? Expect to pay cash, and more of it, than any time since 2011.

Acquisition multiples for Canadian companies have reached the highest in three years, and the percentage of takeovers paid with cash is on the rise, an analysis of deal data shows.

So far this year, there have been 126 takeovers of Canadian companies worth more than $25-million. Buyers are paying an average of 8.4 times earnings before interest, taxes, depreciation and amortization (EBITDA). The average deal is worth 2.2 times the target’s multiple. Almost four-fifths of consideration was cash.