Infotheek, a European provider of hardware and software products, has further formed its growth ambitions with the acquisition of Centralpoint. It is the second major acquisition of the original Dutch (Leidse) company in one month and already the fifth acquisition of 2017. For this transaction, Infotheek relied again upon its trusted M & A consultants, Hogenhouck.
With the acquisition of Centralpoint, established in 2001 and just over € 120 million in annual revenue, Infotheek’s revenue is growing to more than € 700 million, making itself market leader in the Benelux. In total, Infotheek employs about 900 employees, divided among 14 countries *. The acquisition must still be approved by the Consumer & Market Authority (ACM), but complications are not expected.
Infotheek takes over the shares of venture capital investor Greenfield Capital Partners and the founder, Brian Speelman. “With this acquisition we are drawing the line we have started with our shareholder Altor Equity Partners, who has been in business since last year,” says Jordy Kool, CEO of Infotheek. Kool adds: “With our online knowledge and experience, we offer our shared customer base wider online access to circular IT. As a result, we reach a larger target group to extend the lifespan of more IT products. Together we form a strong future-proof player in both the national and European IT markets. ”
Trusted M&A Advisors
As in various previous acquisitions (approximately 10 in the last two years), Infotheek Group has again appealed to three advisors, which are now entitled “trusted advisors”: first of all M&A boutique Hogenhouck, which is Infotheek its trusted advisor since 2008, BarentsKrans the The Hague law firm and tax advisors of EY.
Rik Stikkelbroeck, Managing Partner and co-founder of Hogenhouck, says about the many years of collaboration: “It is a great pleasure for us to work closely with Infotheek. Despite the acquisition of Infotheek by the Swedish Private Equity firm Altor (Altor Equity Partners) in 2016, a process that we as Hogenhouck have also been able to guide, relatively little within Infotheek has changed. The daily management is unchanged in the firm hands of CEO Jordy Kool, the management team is in the years almost unchanged”.
“It’s great to see that a relationship that started in the summer of 2008 – Infotheek was at that time good for € 52 million turnover – developed into 2017 in an international company with more than € 700 million revenue, which is – looking at the financial crisis that took place between 2009 and 2012 – a ‘hell’ of a performance” continues Stikkelbroeck.
Following Hogenhouck’s advise on management participations (during 2008 and 2010 the management of Infotheek could become shareholders through an ESOP), the first acquisition took place in 2013 (acquisition of Condor Computers), after which the acquisitions of Nimble IT (2014), 4Launch and Network2Day (2015), the sale to Altor Equity Partners (2016) and the acquisitions of Added Dimension (UK), GHS, Core10 (Norway), Scholten Awater and Centralpoint (2017) quickly followed, acquisitions all under management of Hogenhouck.
Stikkelbroeck further comments: “In a sense, Infotheek Group has grown over the years to be able to do more and more large acquisitions. It is interesting to see that the acquisitions took place on their own. In the early years, it was primarily strategic acquisitions to grow in certain verticals (such as the acquisition of Condor Computers focused on Apple products) and the acquisition of 4Launch (to grow faster in e-commerce). In later years, there was the focus on gaining additional market share, the acquisitions of Scholten Awater and Centralpoint, as an example. “
The acquisition of Centralpoint fits into the consolidation trend that has been visible in the European IT market over recent years. Research from KPMG showed that between 2015 and 2016, the number of technology in Europe increased by 6%, from 7,052 in 2015 to 7,353 in 2016. The Netherlands had 74 techs last year compared to 61 the previous year.
A European example included the acquisition of Microsoft CRM specialist Mindsunited in early 2017 by The IT Channel Company (TICC), part of Microsoft Dynamics specialist Quattro Business Solutions. And in our country, for example, Dutch automater SecureLink took over Swedish industry leader Coresec (2016), NPQ (provider of facility software solutions) joined Total Specific Solutions (2017) and acquired ICT service provider Centric hosting provider Bitlibre (2017).
CEO Jordy Kool is clear about their own ambitions in the market. “With this acquisition we continue the line that was started with our shareholder Altor,” he said in the press release on the acquisition of Centralpoint. The aim is to become the largest in Europe with Infotheek, and from that position, it is possible to make the move to another continent. In 2016, Kool called for the ambition of € 1 billion turnover in 2020, and that ambition seems real. Although owner Altor previously brought Dustin Group to the stock market, Kool does not immediately assume that that will happen with Infotheek. “In the long term, we do not exclude a stock exchange or takeover by a strategic party. But in the short term, this is not the case, continues Kool.
The continued growth and ambitions of Infotheek will not do any harm to Hogenhouck, but in addition to these major transactions, an analysis of Hogenhouck’s trading portfolio in 2016 shows that the M&A boutique has been active in much more industry lines. During the year 2016, according to Stikkelbroeck “the best year” in the history of the still young firm (ten years), Hogenhouck was involved in an impressive eighteen (18) transactions. In addition to the above-mentioned deals, in 2016, Cornelis Vrolijk took over Seafood Parlevliet (one of the largest transactions that year in the Fish Sector), Hot ITem (IT) was sold to the Hoge Dennen (BI / IT), Pat Kruger (safety on and offshore) was acquired, Geomet (soil research) and the acquisition of TrainMore (a fitness chain) all took place next to 15 other transactions in different industry lines (staffing, security etc).
The key to the success of Hogenhouck lies according to Stikkelbroeck (Hogenhouck’s Managing Partner) in the approach that the boutique follows in supporting deals: “You are as good as your last game”. In practice, this means that you need to take time to do acquisitions, knowing the client and the target. Clients are well capable to estimate the business ratios, our role in maintaining the process should be the one that makes processes efficient, effective, professional, but also fun. This clearly means managing the expectations of the parties concerned and simply not neglecting possible doubts”.
This approach seems to be well-liked by Hogenhouck’s clients to date – 40% of the clients are returning, “and that may be only part of the story,” Stikkelbroeck adds, adding: “The biggest compliment in our work is the appreciation we get from our clients, which gives us the energy to continue to realize beautiful transactions. “Stikkelbroeck concludes:” We expect that the appetite for acquisitions specifically in the IT sector (including hardware and software, managed services and managed hosting) will last for another 1 to 2 years. Undoubtedly the market will cool down in 2019/2020 as soon as the most significant consolidations have taken place at national level. “Apart from the current deal (s), Infotheek is currently supported by another consultancy firm. First Consulting helps Infotheek to optimize the efficiency of logistics processes within its warehouse. This implements an important prerequisite for Infotheek in realizing its ambitious growth plans.
* Infotheek has offices in Leiden, Barcelona, Mechelen, Ulm, Böblingen, Stockholm, Gothenburg, Vélizy en Milton Keynes.