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Röko - a EUR 270m juggernaut acquirer aiming for an IPO

Gustaf Hakansson
July 25, 2021
Röko - a EUR 270m juggernaut acquirer aiming for an IPO

RÖKO - 100x by 2040?

Fredrik Karlsson is the former CEO of the Swedish serial acquirer Lifco (100x the money in 20 years).

His new firm, co-founded with Tomas Billing from Nordstjernan, raised EURm 270 in commitments from investors two years ago.

An IPO is only a few years out, with half of the capital already deployed into 14 acquisitions.

Focus

Röko has mainly acquired owner-led firms, as they share a similar long-term approach.

In contrast to Lifco's predominant 100% acquisitions, Röko allows for seller minority ownership (up to 40% so far).

Röko also focuses on smaller firms with EBITAs of EURm 2-10.

Röko's main priority is not to do any damage to already good businesses. They act as sounding boards to the remaining minority owner-operators.

Screening

Röko stays in regular contact with ~560 brokers. To keep communication crisp, they have clear target criteria.

Röko's stated 10% EBITA margin requirement is flexible depending on the firm's asset intensity though.

They are open to acquiring growing European niche businesses in any industry.

A fascinating insight from Fredrik is that England has seen increased seller activity after capital gains tax hike fears.

Complex ownership structures spread over distant family members have made Germany harder to enter.

Serial Acquirers insight

Fredrik has seen competition from serial acquirers / "M&A compounders" increase every year.

The already common model in Sweden continues to gain traction with ever more firms raising capital.

Recently publicly listed Swedish M&A compounders include Sdiptech, Teqnion, Infrea, Idun Industrier, Seafire, and Addvise Group.

Fredrik guesses that Sweden's history of "freedom with responsibility" explains why the model is more common in the region.

Reach out to Fredrik Karlsson to understand if Röko is the right fit for your company. Or to get your M&A advisory in front of a European acquirer active for years to come.

P.S.

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