Liberty Posted October 17, 2018 Author Share Posted October 17, 2018 I think I finally beat Liberty https://www.jonassoftware.com/About_Us/Latest_News/Jonas_Software_Announces_the_Acquisition_of_Greyco Achievement unlocked for you! Interesting vertical: "a global leader of software solutions for the Paper & Board, Plastic Films & Flexible Packaging, Nonwovens, Metals and Converting industries." Video about the company: Link to comment Share on other sites More sharing options...
gary17 Posted October 25, 2018 Share Posted October 25, 2018 Q3 2018: http://www.csisoftware.com/wp-content/uploads/2018/10/CSI-Press-Release-Q3-2018.pdf Seems like the margin has "recovered" in Q3... Link to comment Share on other sites More sharing options...
Liberty Posted October 25, 2018 Author Share Posted October 25, 2018 I posted some thoughts here: Link to comment Share on other sites More sharing options...
gary17 Posted October 25, 2018 Share Posted October 25, 2018 An interesting thought process , and i'm sure it was answered before - is if they stop acquiring new businesses, then they'd essentially stop creating value in a sense. In other words, their high ROIC is based on being able to keep deploying the capital for good returns ; but that ROIC would go down over time if they accumulate capital . but i think the consensus here is there are plenty of stuff to buy still. Link to comment Share on other sites More sharing options...
Liberty Posted October 25, 2018 Author Share Posted October 25, 2018 An interesting thought process , and i'm sure it was answered before - is if they stop acquiring new businesses, then they'd essentially stop creating value in a sense. In other words, their high ROIC is based on being able to keep deploying the capital for good returns ; but that ROIC would go down over time if they accumulate capital . but i think the consensus here is there are plenty of stuff to buy still. Pretty sure it's been discussed previously in this thread, and it's been addressed in previous annual letters and somewhat at some of the AGMs I've been at. The general idea is that capital allocation is about putting your limited capital where you're getting the highest returns. In the past they've tried investing more in organic growth and tracked results, and generally the results don't seem to be as good as what they can get with M&A. If they somehow couldn't do M&A anymore, they would no doubt redeploy more capital to organic growth (hire more people to write new modules, to enter new markets, to refresh old software more often, invest more in sales and marketing, etc). They'd probably do special dividends for excess cash. Mark Leonard has said that's his preferred way to return excess capital, if it ever gets to that. Also, looking at their aggregate organic growth numbers doesn't tell the whole story. They aren't like, I don't know, TYL or MKTX, with one or a few main things that they try to sell to everyone and grow. They have hundreds of business units and they buy all kinds of things. What matters is creating value, not putting up the best organic growth numbers, so they buy businesses in runoff (f.ex. lately in real estate or oil & gas, mining) that still create a lot of value but are headwinds to organic, and they buy things and then shut down low-margin/ROIC hardware sales divisions and consulting arms, etc. As I think Mark said in the past, it's easy to grow faster organically and inorganically, but it's hard to do it at the kind of ROIC that they're looking for--for the former they could just start price wars with their competitors and invest a ton of money into creating new products/modules, by doing so they'd probably show good growth but would probably create little value or destroy it, and for the latter they could just lower their hurdles and deploy a lot more capital in M&A, showing greater growth and lowering the cash pile, but that too would lower returns. So don't get me wrong, higher organic growth while staying disciplined would be great and create tremendous value. But in the end, what matters to me is that they keep ROIC high, great FCF/share and keep a strong balance sheet to be able to deploy a lot of capital if there's ever a large opportunity that comes along. I still think someday the stars will align and we'll wake up one morning and learn that they've been able to buy a large VMS for $500m or $1bn or $1.5bn... Link to comment Share on other sites More sharing options...
Liberty Posted October 26, 2018 Author Share Posted October 26, 2018 Putting Q3 M&A deployment of capital in historical context (they did $92m, or $114m with deferred payments). Higher than all but a few quarters (this chart doesn't show 1Q18 ($367 million) and 2Q18 ($55 million)). Link to comment Share on other sites More sharing options...
Liberty Posted November 6, 2018 Author Share Posted November 6, 2018 New shareholder Q&A from Nov 5: http://www.csisoftware.com/wp-content/uploads/2018/11/QA-Nov-5-2018-Final-1.pdf Link to comment Share on other sites More sharing options...
Liberty Posted November 19, 2018 Author Share Posted November 19, 2018 Jonas is pleased to announce that it has acquired Leonardo Worldwide Corporation, a leading provider of digital asset management and digital marketing solutions for the global hospitality industry https://www.jonassoftware.com/About_Us/Latest_News/Jonas_Software_Announces_the_Acquisition_of_Leonar Link to comment Share on other sites More sharing options...
FiveSigma Posted November 19, 2018 Share Posted November 19, 2018 US $21.4M of annual revenue per Crunchbase (https://www.crunchbase.com/organization/leonardo-worldwide-corporation), though not clear how recent that figure is. Link to comment Share on other sites More sharing options...
Liberty Posted December 7, 2018 Author Share Posted December 7, 2018 Writeup by Scuttleblurb (subscription required): https://www.scuttleblurb.com/csu/ Link to comment Share on other sites More sharing options...
Liberty Posted December 11, 2018 Author Share Posted December 11, 2018 Acquisition at Harris: https://www.harriscomputer.com/en/news/?data-ipsquote-timestamp=1543986000&article=harris-rsquo-us-healthcare-group-acquires-psytech-solutions-inc- Link to comment Share on other sites More sharing options...
Liberty Posted December 19, 2018 Author Share Posted December 19, 2018 Irish acquisition: https://www.irishexaminer.com/breakingnews/business/cork-beauty-software-firm-sold-for-over-15m-892840.html Link to comment Share on other sites More sharing options...
Liberty Posted December 19, 2018 Author Share Posted December 19, 2018 Another one at Volaris: https://www.motortrader.com/motor-trader-news/automotive-news/cox-automotive-sells-incadea-dms-business-volaris-13-12-2018 Link to comment Share on other sites More sharing options...
FiveSigma Posted December 19, 2018 Share Posted December 19, 2018 This is potentially a very large transaction: https://www.incadea.com/company/news-events/recommended-cash-offer-for-incadea-plc-by-dealertrack-technologies-inc/ It was bid on (and I suppose acquired) by DealerTrack in 2014 for GBP 122M, which was CAD 220M at that time. Link to comment Share on other sites More sharing options...
Liberty Posted December 19, 2018 Author Share Posted December 19, 2018 This is potentially a very large transaction: https://www.incadea.com/company/news-events/recommended-cash-offer-for-incadea-plc-by-dealertrack-technologies-inc/ It was bid on (and I suppose acquired) by DealerTrack in 2014 for GBP 122M, which was CAD 220M at that time. I think it's only part of it that is being sold, but it's not clear how big it is. Link to comment Share on other sites More sharing options...
FiveSigma Posted December 19, 2018 Share Posted December 19, 2018 It might be the whole thing, because the press release says "Cox Automotive sells Incadea DMS business to Volaris". DMS is the core product if you look at the website with other solutions being complementary to it. We'll find out after Q1 report unless someone wants to email IR. Link to comment Share on other sites More sharing options...
Liberty Posted December 19, 2018 Author Share Posted December 19, 2018 It might be the whole thing, because the press release says "Cox Automotive sells Incadea DMS business to Volaris". DMS is the core product if you look at the website with other solutions being complementary to it. We'll find out after Q1 report unless someone wants to email IR. I certainly hope it's the whole thing or close to it. I'll see what I can find out. Link to comment Share on other sites More sharing options...
tenyearsout Posted December 20, 2018 Share Posted December 20, 2018 https://www.csisoftware.com/2018/12/constellation-increases-credit-facility-2/ Link to comment Share on other sites More sharing options...
FiveSigma Posted December 20, 2018 Share Posted December 20, 2018 https://www.csisoftware.com/2018/12/constellation-increases-credit-facility-2/ Bullish. Maybe additional large deals coming up. Link to comment Share on other sites More sharing options...
FiveSigma Posted December 20, 2018 Share Posted December 20, 2018 Just got a reply from CSI re: Incadea: "We did acquire the entire business, however the purchase price is well below our disclosure threshold of $50M." Link to comment Share on other sites More sharing options...
gary17 Posted December 20, 2018 Share Posted December 20, 2018 Market doesnt like all the CSI news today ... Link to comment Share on other sites More sharing options...
Liberty Posted December 20, 2018 Author Share Posted December 20, 2018 Market doesnt like all the CSI news today ... I don't think it has anything to do with the news. It's just indiscriminate selling. Link to comment Share on other sites More sharing options...
FiveSigma Posted December 20, 2018 Share Posted December 20, 2018 I also found this: https://www2.trustnet.com/Investments/ArticlePrint.aspx?id=201404290700127125F In 2013 Incadea did ~CAD 55M in revenue and ~CAD 12M in EBITDA. However since that time they grew from serving 2400 dealerships (end of 2013) to 3500 (end of 2014) to 4000 now, so the growth declined significantly in recent years. One can extrapolate revenue increase to ~CAD 92M using dealer counts. Assuming CSI can bring Incadea's margins to their own and paid materially less than CAD 65M (USD 50M threshold), it should prove a solid addition to CSI's portfolio on an ROIC basis. Link to comment Share on other sites More sharing options...
Liberty Posted January 2, 2019 Author Share Posted January 2, 2019 acquisition : "Volaris Group Expands Position in Communications & Media Vertical with Acquisition of Powel Metering" https://globenewswire.com/news-release/2019/01/01/1679288/0/en/Volaris-Group-Expands-Position-in-Communications-Media-Vertical-with-Acquisition-of-Powel-Metering-to-become-Avance-Metering.html Nice to see more acquisitions being done in Scandinavia (the kind of place where VMS makes sense... advanced economy with expensive labor): Avance Metering will be headquartered in Östersund, Sweden, with offices in Linköping, Jönköping, Stockholm, Gothenburg, Sweden, Trondheim, Norway and Gdansk, Poland. Link to comment Share on other sites More sharing options...
Liberty Posted January 3, 2019 Author Share Posted January 3, 2019 One more at Jonas, in England this time (h/t Pearnick): https://www.jonassoftware.com/About_Us/Latest_News/Jonas_Software_Announces_the_Acquisition_of_Minted Link to comment Share on other sites More sharing options...
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