2024-02-07 08:45:00 ET
Summary
- Andvari’s best performing holding in 2023 was Constellation Software.
- In just twelve months, Constellation acquired over 100 niche, vertical market software businesses.
- As Constellation has grown larger, it has continued to produce excellent results by maintaining its decentralized operating structure.
- With a track record of having compounded free cash flows at an annualized rate of 18.8% over the last eight full fiscal years, future returns to shareholders are likely to remain above average.
The following segment was excerpted from this fund letter.
The Compounding of Constellation Software ( CNSWF )
Andvari's best performing holding in 2023 was Constellation Software ( OTCPK:CNSWF ) whose stock had a total return (share price and dividends) of 58.9%. Constellation's spin-offs, Topicus.com ( OTCPK:TOITF ) and Lumine ( OTCPK:LMGIF ), also had stellar years. In just twelve months, Constellation acquired over 100 niche, vertical market software businesses. Most of the acquisitions were small enough that the purchase price was not reported. However, there were several large transactions in 2023 where Constellation was able to allocate hundreds of millions of capital....
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Andvari Associates - Constellation Software: Solid Growth And Compounding