Corporate and M&A

Three quarters of the purchase price in M&A deals is represented by goodwill and intangible assets according to the 2017 Purchase Price Allocation Study from PPAnalyser.  The report highlights the importance of identifying and measuring the value of intangible assets to support the rationale of an acquisition.

Unsurprisingly, transactions in the services sector have the highest proportion of intangible assets and goodwill at 84% of the deal value.  However, somewhat unexpectedly manufacturing has the highest proportion of intangible assets at 41% which, together with goodwill of 35%, means that 76% of the purchase prices in this sector are represented by non-tangible assets.  The mining, wholesale trade, and retail sectors have the lowest proportions of intangible assets.

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