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Main Conclusions
- 1. The Argos Index® continues its downward slide to 9.2x EBITDA.
- 2. The Index is pulled down by strategic buyers, while investment funds prices remain steady.
- 3. The share of deals at a multiple < 7x EBITDA increased, highlighting continued pressure on prices.
- 4. The mid-market M&A activity continues its decline, impacted by the uncertain environment created by the US tariffs and trade disruption.
The Argos Index® continues its downward
slide to 9.2x EBITDA
The Argos Index® declined by 3% to 9.2x EBITDA in Q2 2025, driven primarily by a drop in the multiples paid by strategic buyers, which fell to 8.5x EBITDA. The proportion of deals priced below 7x EBITDA rose to over a quarter of the index sample, underlining sustained downward pressure on valuations.
As in the previous quarter, this decline in prices reflects a sluggish M&A market in the Euro zone, with deal volume estimated to be down 5% and disclosed value down 14% in Q2. President Trump’s “Liberation Day” tariffs announcement in April significantly impacted the economic outlook, disrupting global trade, value chains and the M&A landscape.
Multiples paid by investment funds remained stable at 10.0x EBITDA, with a very specific industry mix (45% of the index sample was in tech/healthcare and 28% in business services). supported by improving financial conditions in the Euro zone – ie. decreasing inflation and interest rates – despite ongoing macroeconomic uncertainty. PE funds continued to deploy capital, focusing on easier to finance businesses with strong fundamentals (in Q2, the average deal size for funds was 60% larger than that of strategic buyers), and in said industries with high visibility.
Argos Index® mid-market
Median EV/EBITDA multiple on a six-month rolling basis
Source : Argos Index© mid-market / Epsilon Research
The Argos Index® is pulled down by strategic buyers
Multiples paid by strategic buyers fell to 8.5x EBITDA in Q2, despite a strong rally in European public equity markets this quarter(1). The yo-yo on US tariffs and trade policy since April, and its impact on equity market volatility, weighed on corporate M&A activity and price recovery. The relative standard deviation of multiples reached a record high (49%), reflecting a polarized market in which large corporates make both opportunistic, low-priced deals and high-premium strategic acquisitions.
Multiples paid by investment funds remained notably stable at 10.0x EBITDA, with a low standard deviation (32%), supported by declining borrowing costs and easier access to financing. LBO activity contracted in Q2 at a pace similar to the overall M&A market: its share of deal volume remained stable at a low 15%, while its share of disclosed deal value rose to a record 33%, indicating a sharp increase in average transaction size.
The spread between fund and strategic buyer multiples widened to a high level of 1.5x EBITDA, reflecting increasingly divergent investment strategies. Under pressure to deploy or return committed capital – and despite an uncertain economic outlook – PE funds continue to target large, high-quality assets that are resilient to downturns and more likely to secure financing, for which they are paying a premium.
(1) The EURO STOXX TMI Small Index is up 9% in Q2 and 15.5% on S1 2025.
Enterprise value / historical EBITDA
Source : Argos Index© mid-market / Epsilon Research
Sharp surge of transactions at extreme multiples
In Q2 2025, the share of transactions at extreme multiples rebounded to 40% of the index sample, driven by a rise in deals priced at the low end (below 7x EBITDA), while transactions above 15x remain at subdued levels.
Share of transactions at extreme multiples (15x EBITDA)
Source : Argos Index© mid-market / Epsilon Research
Share of transactions at multiples >15x EBITDA Argos Index® sample
Deals below 7x EBITDA now represent 27% of the analysed sample, underscoring persistent downward pressure on valuations.
Share of transactions at multiples 15x EBITDA Argos Index® sample
The M&A mid-market activity continued
its decline in Q2 2025
Euro zone mid-market M&A activity continued its decline in Q2 2025, with estimated deal volume down 5% and disclosed value down 14%. Over the first half of the year, activity fell by 17% in volume and 23% in value compared to H2 2024.
The anticipated rebound in M&A activity has yet to materialize – unlike the equity markets – as global dealmaking continued to decline in Q2. In Europe, the number of deals(1) dropped by 10%, while total deal value declined by 5%. Political and economic shocks have stalled many transactions: ongoing volatility in US tariffs and trade policy since Trump’s “Liberation Day” has fuelled corporate uncertainty, disrupted value chains, and complicated asset valuations.
Euro zone M&A remains subdued despite improving fundamentals: the ECB has adopted a more accommodative monetary stance, cutting key rates by over 2pts in one year (from 4.25% to 2.15%) as inflation returns to its 2% target. European investment programs – including defence and infrastructure initiatives in Germany – are supporting growth prospects. Meanwhile, the increasing unpredictability of US economic policy is beginning to shift momentum in Europe’s favor.
(1) Source: LSEG in Les Echos, 01.07.2025
Eurozone mid-market activity (€15–500m) in volume (# deals) and value
Source : Argos Index© mid-market / Epsilon Research
Eurozone Mid-market - Number of deals
Investment fund activity declined in line with the broader M&A market. Their share(1) of mid-market M&A over the past six months remained stable at 15% in deal count, but rose to a record 33% in disclosed deal value.
(1) Does not include build-ups
Share of LBO in Eurozone Mid-market M&A
Source : Epsilon Research / MarketIQ
