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Niklas Sävås

lines on the record: 55
first: 2025-04-11
most recent: 2025-04-11
sittings or episodes: 1
sources: podcast

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“910, and the multiple that these businesses always talk about is the enterprise value to ebit A. I think Ebit is more or less the same, but EBIT A is the metric that these public companies use because they amortize intangibles. And of course, they invest in intangible assets all the time. So it gets double counted. But I think the multiple that has been sort of quite steady for the last decade or so has been around seven to nine times EV to EVT. I think looking back maybe 20 years, I think the multiple was lower, even though some say that it's been stable all the time. I think it was lower back then. But it's been at around 7 to 9. And if you buy a bit bigger companies, it's probably a bit higher and smaller businesses lower. And of course, also if you look at sort of the growth rate of the company. But that's sort of the average, I would say. Often around eight.”
2025-04-11 · We Study Billionaires · TIP713: Why Serial Acquirers Outperform w/ Niklas Sävås · IDENTIFIED FROM THE TRANSCRIPT
“Question many investors ask me is like, and those that are a bit skeptical to this model is that why isn't prices going up? And I think one reason for that is sort of if you have a company which is not growing organically and doesn't have sort of good avenues for organic growth, because that's really hard. If you are sort of a niche market leader in a really small market geographically or byproduct, it's really hard to grow that more than GDP plus maybe a few percentages. And you're often generating a lot of cash flow. And what you can do with that is sort of dividend it out. And if you have that type of business, what price should you get for such a business? I mean, say that you're on the public market, you're a bigger company, but you don't have avenues for growth, you dividend out everything. I mean, a P of 12 or something isn't strange. And then sort of you have a discount to that because you're illiquid, you're a small company. And that leads to maybe a P of”
2025-04-11 · We Study Billionaires · TIP713: Why Serial Acquirers Outperform w/ Niklas Sävås · IDENTIFIED FROM THE TRANSCRIPT
“So, I think that's one piece of it. And of course, I mean, this is a risk that I always think about if more competition would come into this space, what would happen? And we have seen from sort of a few years back, few companies were a bit more aggressive and that led to a bit higher multiples, but not so much. So I think all sort of quality acquires I look at, they continue to do what they had done for the years before. And it didn't matter too much for them.”
2025-04-11 · We Study Billionaires · TIP713: Why Serial Acquirers Outperform w/ Niklas Sävås · IDENTIFIED FROM THE TRANSCRIPT
“Yeah, I mean, I've read all the theory as well. One part of it is that if you do sort of large acquisition by other public companies or other private companies, they don't come on the cheap. You need to pay up for those acquisitions. And for that to work, you have to realize synergies. And I think that's a really hard thing to do. So I think much of the theory focused on that. And I think this sort of programmatic type of acquisition strategy that the serial acquirers have, it's very different. And one piece of that is that these companies on the private market are available at quite low multiples for the long term, even though competitions sort of varies a bit over the years. My feeling is that most buyers of these companies are rational. They know that if you pay up too much, the model sort of breaks down, then you're not able to continue to buy these companies, generate the cash flows you need in order to continue the strategy. You are not able to grow as much as you want.”
2025-04-11 · We Study Billionaires · TIP713: Why Serial Acquirers Outperform w/ Niklas Sävås · IDENTIFIED FROM THE TRANSCRIPT
“Sure. So, I mean, a series as it sounds a company that's able to reinvest a lot of its generated cash flows to buy private companies. And I think for us, we deem that to be that they are able to grow by 10% from acquisitions is sort of a benchmark that you should be able to do. I mean, it's often or always I would say that you buy multiple private companies, smaller companies. And with small, I mean like everything between 5 million US in sales up to around 30. I think that's at the core of it and so that we can dig into the nuts and bolts.”
2025-04-11 · We Study Billionaires · TIP713: Why Serial Acquirers Outperform w/ Niklas Sävås · IDENTIFIED FROM THE TRANSCRIPT