German Serial Acquirers: Only 3 of 10 Earn Above Cost of Capital
[Part of our Global Serial Acquirer Scorecard]
Key Finding: Only 3 of 10 German serial acquirers earn above 12% ROIC, and all three carry caveats. Six earn below 5% — the worst Tier D rate of any market screened. Zero companies sit at the borderline. Germany’s serial acquirer landscape is binary: it works, or it destroys capital.
We screened 10 traditional German serial acquirers listed on XETRA by return on invested capital. Three earn above a 12% cost of equity — each with qualifications. One earns between 5% and 10%. Six destroy value. No other market produces this level of failure.
The German Serial Acquirer Scorecard
| # | Company | Ticker | ROIC | GW/TA | (GW+Int)/TA | Op Margin | Drawdown | Tier | Verdict |
|---|---|---|---|---|---|---|---|---|---|
| 1 | Amadeus Fire | AAD | 15.7% | 52% | 58% | 12.5% | -61.7% | A | One acquisition destroyed 49% ROIC. |
| 2 | GEA Group | G1A | 14.7% | 25% | 30% | 9.9% | -16.7% | A | Turnaround. Only clean Tier A. |
| 3 | Nemetschek | NEM | 14.5% | 53% | 71% | 24.1% | -51.7% | A | Goodwill doubled in one year. Watch closely. |
| 4 | SAF-Holland | SFQ | 6.3% | 8% | 27% | 8.8% | -25.5% | C | Low GW/TA but can’t earn CoC. |
| 5 | Dermapharm | DMP | 4.7% | 27% | 51% | 15.9% | -20.8% | D | COVID spike gone. Back to reality. |
| 6 | Indus Holding | INH | 3.8% | 22% | 32% | 7.3% | -23.9% | D | Decade of mediocrity. |
| 7 | MBB SE | MBB | 3.6% | 4% | N/A | 7.8% | -18.6% | D | Collapsed from 20%. Portfolio deteriorated. |
| 8 | Compugroup Medical | COP | 2.4% | 37% | 70% | 9.2% | -5.1% | D | Takeover bid masks the rot. |
| 9 | Norma Group | NOEJ | 1.2% | 29% | 39% | 5.0% | -45.9% | D | Collapsed from 12%. Never recovered. |
| 10 | Brockhaus Tech | BKHT | -0.6% | 33% | 56% | 23.0% | -63.3% | D | Overpayer. High margins, negative ROIC. |
Tier A: 3 companies (30%). Tier B: 0 (0%). Tier C: 1 (10%). Tier D: 6 (60%).
No Tier B. No borderline cases. Germany is the most polarized market in our screen — companies either earn above cost of capital or destroy value outright.
Three Qualified Wins
Every German Tier A company comes with a caveat. No other market has this problem.
GEA Group — 14.7% ROIC with 25% GW/TA and 30% (GW+Int)/TA. The only clean Tier A name. GEA is a turnaround story — improved operational efficiency, not acquisition prowess, drove ROIC above cost of capital. Operating margins of 9.9% are modest, but the disciplined goodwill level leaves room. Down only 16.7%.
Amadeus Fire — 15.7% ROIC with 52% GW/TA and 58% (GW+Int)/TA. Before its acquisition, Amadeus Fire earned 49% ROIC with just 8% GW/TA and 18% operating margins. One deal destroyed 33 percentage points of ROIC. Goodwill jumped 25x. The underlying staffing business is still strong — 12.5% margins on a now-bloated balance sheet still clear cost of capital. But this is a Tier A company only because the pre-acquisition business was so good that even massive capital destruction left ROIC above 12%. Down 61.7%.
Nemetschek — 14.5% ROIC with 53% GW/TA and 71% (GW+Int)/TA. Software for architecture and construction. Operating margins of 24.1% are the highest in the German screen. But goodwill doubled in a single year — from EUR 552M to EUR 1,135M. At 71% combined intangible ratio, only 29% of assets are tangible. Nemetschek is earning above cost of capital today; the question is whether the massive goodwill addition sustains or compresses returns. Down 51.7%.
The Graveyard: 60% Below 5% ROIC
Six companies earning below 5% ROIC. Each fails for a different reason.
Overpayer: Brockhaus Tech
Brockhaus Tech — negative 0.6% ROIC with 23.0% operating margins, 33% GW/TA, and 56% (GW+Int)/TA. The most extreme margin-ROIC disconnect in any market we screen. Operating margins of 23% should produce 15%+ ROIC in most businesses. Instead, Brockhaus destroys value — the acquisition premiums paid are so large that excellent operations cannot service the goodwill. Down 63.3%, the deepest drawdown in the German universe.
COVID Mirage: Dermapharm
Dermapharm — 4.7% ROIC with 27% GW/TA and 51% (GW+Int)/TA. ROIC spiked to 34% during BioNTech vaccine manufacturing. The underlying pharma roll-up never earned cost of capital. Now 4.7% as the COVID tailwind reverses and the goodwill base — which tripled to EUR 579M — stays inflated. Operating margins of 15.9% are decent, but the 51% combined intangible ratio absorbs them.
Portfolio Decay: MBB SE
MBB SE — 3.6% ROIC with just 4% GW/TA. The lowest goodwill in the screen — and it doesn’t matter. MBB’s problem isn’t overpaying for acquisitions; the portfolio companies’ operating performance deteriorated. ROIC collapsed from 20% to 3.6%. Low goodwill does not save you if subsidiaries stagnate.
Collapsed: Norma Group
Norma Group — 1.2% ROIC with 29% GW/TA and 39% (GW+Int)/TA. Collapsed from 12% and never recovered. Operating margins of 5.0% are the thinnest in the screen. Down 45.9%.
Takeover Bid: Compugroup Medical
Compugroup Medical — 2.4% ROIC with 37% GW/TA and 70% (GW+Int)/TA. Under CVC Capital takeover bid, which explains the mild -5.1% drawdown — not market-priced. The 70% combined intangible ratio tells the real story: healthcare IT acquisitions loaded the balance sheet with goodwill and identifiable intangibles that the business cannot service.
Decade of Mediocrity: Indus Holding
Indus Holding — 3.8% ROIC with 22% GW/TA and 32% (GW+Int)/TA. Operating margins of 7.3%. A holding company model that never generated the returns serial acquisition promises. Down 23.9%.
The Different Models
Two German companies operate fundamentally different models and are excluded from the traditional screen.
Mutares — 23.7% ROIC with 0.6% GW/TA and 35% (GW+Int)/TA. Turnaround and carve-out specialist: buys distressed businesses for EUR 1, restructures, exits. Operating margins are negative (-8.5%) because revenue includes distressed operations in transition. The 23.7% ROIC reflects the spread between purchase price (near zero) and exit value. Not comparable to traditional serial acquirers. Down 39.6%.
DBAG — 16.2% ROIC with 0% GW/TA. A listed private equity fund. Revenue consists of investment gains, not operating income. No operating margin is applicable. Not a serial acquirer in any meaningful sense. Down 19.1%.
Both earn above cost of capital. Neither reveals anything about Germany’s serial acquirer landscape.
Cross-Market Context
| Metric | Germany (10) | UK (11) | Sweden (24) |
|---|---|---|---|
| Above 12% ROIC | 3 (30%) | 2 (18%) | 6 (25%) |
| Below 5% ROIC | 6 (60%) | 3 (27%) | 9 (38%) |
| Avg GW/TA | 27% | 28% | 34% |
| Worst drawdown | -63.3% BKHT | -50.2% JDG | -61.8% VIT-B |
Germany has the highest Tier D rate of any market screened — 60% earn below 5% ROIC. Canada is next at 54%, then Sweden at 38%. The UK at 27% shows that European serial acquirers can avoid mass value destruction with disciplined balance sheets.
Germany’s average GW/TA of 27% is moderate — similar to the UK’s 28%. The failure isn’t about aggregate goodwill levels. It’s about individual capital allocation: one-deal destruction (Amadeus Fire), COVID mirages (Dermapharm), portfolio decay (MBB), and chronic inability to earn cost of capital (Indus, Norma, Brockhaus).
What to Look For in German Serial Acquirers
Four filters for this market:
- Demand pre-acquisition track record. Amadeus Fire earned 49% ROIC before its deal. That pre-deal quality is what saved it from Tier D. If a German acquirer didn’t earn 15%+ ROIC before its largest acquisition, it won’t earn 12% after.
- Check the combined intangible ratio. GW/TA alone understates the balance sheet risk. Nemetschek’s 53% GW/TA becomes 71% at (GW+Int)/TA. Compugroup’s 37% becomes 70%. Dermapharm’s 27% becomes 51%. The true acquisition load is in the combined ratio.
- Ignore one-year spikes. Dermapharm’s 34% COVID ROIC was not real. Evaluate 5-year ROIC trends, not point-in-time peaks.
- Low goodwill is not enough. MBB at 4% GW/TA and 3.6% ROIC proves that minimal acquisition premiums don’t matter if the underlying businesses deteriorate. Operating quality matters more than balance sheet cleanliness.
Methodology
We screened 10 traditional German serial acquirers listed on XETRA (Compugroup Medical on Hamburg exchange). All financial data in EUR.
- ROIC: Net operating profit after tax / invested capital (equity + debt - cash), with goodwill included in the denominator. Source: QuickFS (latest fiscal year, exchange code: DE).
- GW/TA: Goodwill / total assets (most recent quarter). Source: QuickFS.
- (GW+Int)/TA: Combined goodwill and identifiable intangible assets / total assets. Source: QuickFS.
- Operating margin: Operating income / revenue (latest fiscal year). Source: QuickFS.
- Drawdown: Maximum decline from 5-year peak. Source: Yahoo Finance (.DE suffix).
- Tier classification: A (>12%), B (10-12%), C (5-10%), D (<5%).
- Data as of: February 2026.
Two companies — Mutares (turnaround/carve-out) and DBAG (listed PE fund) — operate fundamentally different models and are excluded from the traditional screen. Compugroup Medical is under a CVC Capital takeover bid; its -5.1% drawdown reflects the bid price, not market pricing.