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- Deep dive into Nordic software acquirers. Part 1: What can we glean from Visma's €4B M&A spree?
Deep dive into Nordic software acquirers. Part 1: What can we glean from Visma's €4B M&A spree?
Alex Prokofjev
August 29, 2024
Which corner of the world has the highest number of software serial acquirers, on a per capita basis?
Our guess is, Northern Europe - by a wide margin. Our database contains 30+ entries for Norwegian, Swedish, Finnish and Danish tech serial acquirers (predominantly software).
Source: RollUpEurope analysis
The industry is fluid, with (relative) newcomers like Nordtech, Lyvia, Confirma and Hawk Infinity co-existing with the veterans Visma, Vitec and EG. And that’s before you account for scores of vertical specialists like Byggfakta or SmartCraft (SaaS for construction / craftsmen).
Nic Humphries, a Senior Partner at Hg and a Visma Board member, offered one explanation on the Business Breakdowns podcast:
The Nordics are some of the most advanced, but also some of the most expensive markets in the world. Those markets are bound to have productivity as a very requirement early on
In other words, software density is high because so are wages. Demographics too play a role. Over the last quarter century, Sweden’s population has grown at the same pace as America’s.
Another explanation why all these companies can keep acquiring is because they keep adding value with M&A. In a two-part series, we have crunched the numbers on Nordic software serial acquirers to explain what they have bought; why; and for how much.
We kick off with a deep dive on Visma: Europe’s most prolific software HoldCo.
In 2019-23, Visma closed 165 acquisitions, adding €800M of revenue (but only -€9M in aggregate profits). Total acquisition cost was over €4B.
Source: Visma filings, RollUpEurope analysis
*Note: since Visma does not disclose average % acquired in aggregate figures, we have assumed 100% for 2019 and 90% for 2020-23
In Q2 2024, Visma reported run-rate revenue of €2.7B and EBITDA of €850M. That’s nearly 2X vs. 2020. A December 2023 fundraise valued the business at €19B. This is equivalent to 8X revenue and 27X EBITDA, both on a trailing 12 month basis, a premium to comparable transactions involving scaled-up serial acquirers.
In this article, we reveal:
Visma’s acquisition criteria
What multiples Visma had paid historically - and why
How Visma structures deals to achieve buyer and seller alignment
5 years ago, Visma paid 11X revenue for PowerOffice. Was it worth it?