Is it valid to include both announced and closed deals in the set of Precedent Transactions?

Including both announced and closed deals in the set of precedent transactions is valid because it provides a more comprehensive view of market activity and valuation multiples. Announced deals represent the transactions that have been agreed upon but have not yet completed, reflecting current market sentiment and potential deal premiums. These transactions can indicate buyer interest and valuation levels that are still relevant for comparable analysis.

On the other hand, closed deals represent completed transactions that provide solid data points on actual valuations achieved, making them critical for understanding historical trends and market behavior. By considering both, analysts get a fuller picture that helps in valuations and assessing market trends, leading to better-informed investment decisions.

This approach allows analysts to capture the dynamics of the market more effectively, as it includes not only historical data but also anticipated market movements based on recent announcements.