Case Study Bien Zenker
Bien-Zenker GmbH designs, constructs and markets prefabricated houses. Its portfolio ranges from self-assembly kits to luxury turnkey houses.
“This acquisition posed a number of challenges to begin with,” says Dr. Matthias Meise, Co-founder of ADCURAM. For instance, the due diligence obligation was severely limited by the capital market situation. “The fact that we were only able to acquire 89.44 percent of the shares in Elk Fertighaus AG also made things rather difficult,” he continues.
Under company law, 90 percent is the minimum share for a squeeze-out. Further challenges included the slender share purchase agreement with no list of guarantees and an imminent succession Situation in management.
ADCURAM initially acquired an interest in Bien-Zenker in 2013, when it purchased the Elk Fertighaus AG share package. ADCURAM financed more than 70 percent of the transaction through its own funds. It then acquired the remaining shares – by means of a voluntary public take-over offer and a successful squeeze-out procedure.
ADCURAM optimized the purchase, invested in technological equipment and strengthened the company’s sales operations. It established productive commercial processes and implemented an end-to-end ERP system.
“By constructing an independent sales organization and a new product portfolio under a new brand name (Living Haus), we concentrated our activities in the lower price segment and made a massive investment in future growth,” Meise explains.
The success of this strategy has proved ADCURAM right. Today, Bien-Zenker GmbH is one of the most profitable suppliers of prefabricated houses in Germany. In 2014, the Federal Ministry of Construction awarded Bien-Zenker a prize for its sustainable detached and semi-detached homes. Most recently, the company has also earned the highest distinction of “excellent” at the BAU 2015 international trade fair.
In 2014, the company had a workforce of 450 and generated revenues of €125 million.
Case Study Hennecke
The Hennecke Group has been developing and constructing top-quality machinery and plant technology for polyurethane processing for more than six decades. With its many patents and long tradition, it has played a decisive role in the shaping of modern technology.
Its team of production, sales and service technicians at work all over the globe has made Hennecke today’s leading partner for top manufacturers in the automobile, household equipment and construction materials sectors.
“We took over Hennecke from Bayer AG in 2008 as part of a carve-out process,” explains Thomas Probst, Co-founder of ADCURAM. At the time of the acquisition, we faced a number of challenges. Hennecke had been a peripheral member of the Bayer Group for decades, making operating losses in several product fields.
It needed transforming from a group subsidiary into a vigorous medium-sized business with a lean organization, powerful IT systems and entrepreneurial culture.
“Our aim at ADCURAM always lies in establishing our group company as the leading supplier in its market and developing it along sustainable lines. The path taken by Hennecke is a good example of this. Our innovative and sustainable corporate philosophy has completely taken root in the company,” says Probst.
Plentiful investment in Hennecke quickly enabled it to stand on its own two feet. “It wasn’t long before we reached the first milestones,” he continues.
ADCURAM intensified investments in research and development, international sales, the service organization and a new site in China. Hennecke constructed a new factory in Shanghai, which now has a workforce of approximately 100 employees in production, sales, construction and service.
The profitability of the Hennecke Group keeps on steadily increasing. In 2014, we were able to achieve an EBITDA return of 10 percent and can see yet further potential.
Case Study Duran
DURAN is one of the world’s leading manufacturers of borosilicate glass, a special kind of glass that is particularly chemical- and temperature-resistant. It is used primarily in glass laboratory equipment and in chemical process technology. Invented by Otto Schott in 1887 and patented under the trade name DURAN in 1938, borosilicate glass has been used and approved in laboratories, industry and private households all over the world for more than 100 years,” says Dr. Florian Meise, Co-founder of ADCURAM. This industrial glass is also used in mechanical engineering, the electrical engineering industry and medical equipment.”
ADCURAM acquired the DURAN Group in 2005 from Schott AG as part of a complex carve-out. The Federal Association of Mergers & Acquisitions in conjunction with FINANCE magazine proclaimed this transaction the “Top M&A Deal of 2005”. Carve-outs from complex corporate structures often place greater demands on the buyer than anticipated. “A holistic, pragmatic and realistic concept often helps in cases like these,” Dr. Meise explains.”
ADCURAM quickly notched up the first milestones, galvanized the management team and introduced the appropriate processes and structures for a medium-sized business. Separate departments for accounting, IT, HR and finance were swiftly established, which was quickly also apparent to the outside world. The new brand and coherent market presence were quickly communicated and have continued to underline DURAN’s success as an independent entity ever since.
By redressing surplus capacities, the company succeeded in boosting the efficiency of its production considerably. “We secured important long-term contracts with customers,” Dr. Meise recalls. ADCURAM invested more than €10 million in expanding the company’s technological base, trebling the new products rate and promoting geographic growth. At the same time, DURAN acquired businesses in the United Kingdom and India and adopted new brands, gaining access to new materials and regions along the way. The company’s current workforce of around 700 employees now generates revenues somewhere in the region of €100 million.
ADCURAM sold DURAN to One Equity Partners (OEP) in March 2015 after spending ten years successfully developing the business. Today, the company is in an outstanding operational, strategic and financial position. “We have no doubt whatsoever that OEP, as an experienced, financially strong international investor, will offer valuable support to the company’s management as it strives to achieve further growth,” says Meise.