The Dutch manufacturing industry’s most remarkable transactions in 2018

Which transactions and movements in the second half of 2018 in the Dutch manufacturing industry stood out? Corporate Finance International (CFI) compiled an inventory.

Both 2017 and 2018 have proven to be remarkable years for the Dutch manufacturing industry, both showing in excess of 247 transactions with 2018 totalling some 265 movements involving Dutch companies. In the first six months of that year the active materials and brick industry particularly stood out.

So what were the key market movements in the last six months of 2018 according to advisors Martijn Liem and Jaap de Jong of Corporate Finance International (CFI)?

Increasing international focus

It was the increasing international focus of the mergers and acquisitions market that once again stood out. Of the 146 international transactions, 92 involved foreign companies buying Dutch companies, with 54 Dutch firms acquiring foreign entities.

American parties in particular were very active buyers; by far the most international transactions (some 30) involved a Dutch and an American party. One such buyer was food tech giant JBT Corporation taking over Almelo-based FTNON, a manufacturer of equipment for the production of fresh produce, ready-to-eat meals and pet food.

Honeywell grew by taking over Transnorm, supplier of warehouse automation systems. And Carplugs, specialist in plastic molding, joined forces with LoVen Special Products, supplier of vinyl caps and coatings.

Dutch parties have become more active in the German market, resulting in 18 transactions. Most other buyers or acquisition candidates came from the United Kingdom (16 transactions) and France (12).

China not involved

Remarkable was the underrepresentation of Chinese firms, which were involved in only three transactions in the past year. Philips Lightning bought Chinese LiteMagic Technologies (manufacturer of fittings and control systems for urban façade lighting), and last autumn Dutch chip manufacturer Nexperia was acquired by Wingtech Technology. The latter, which claims to be the largest producer of smartphones globally, took over Nijmegen-based Nexperia for more than 3 billion euros.

The lack of Chinese activity seems to go against general presumption that Chinese companies are constantly combing the European market in the search of interesting acquisition candidates. The fact that this does not appear to be the case may be explained by cultural differences; perhaps Chinese buyers miss out more often due to their relatively slow decision-making structure.

Verder

Another  noteworthy transaction involving an Asian company, is the acquisition of South Korean pumps manufacturer JEC Ltd. by Dutch family business Verder Groep (the number 1 in the Maakindustrie100). Verder, a fast-growing niche market manufacturer of pumps and  laboratory equipment, has expanded its portfolio by adding JEC, specialist in the production of rotary lobes, circumferential pistons and twin screw pumps.

Agrofood

Chemicals, high-tech, consumer goods and private equity were the industries in 2018 showing the most transactions. In the agrofood industry Royal Friesland Campina stood out with a number of major transactions; the dairy corporation took over Dutch cheese producer Best Cheese Holland and Spanish cheese packer and distributor Millán Vicente.

In the same sector, food company Royal Wessanen took over Abbot Kinney’s. The Dutch company produces vegetable-based yoghurt and ice cream, and is therefore a perfect match for Wessanen’s strategy in which plant-based food plays a key role. Further, IZICO Food Group took over snacks producer of kroketten and bitterballen Excellent Food & Snacks.

Spanish frozen vegetables producer Virto took over Dutch Oerlemans Food to reinforce its European position. Another remarkable transaction was the takeover of plant feed producer Chrysal International by Japanese OAT, which is looking to expand its position in the market after the flower harvest.

Maakindustrie100

In the first half of 2018, a considerable number of Dutch businesses from Maakindustrie100 ended up in foreign hands with VanRiet Group, Synbra, Ammeraal, CSi Industries, Vekoma, BOAL and Bugaboo all being  sold to foreign parties.

Kinkelder

In the second half of the year, Kinkelder (number 54 in the Maakindustrie100) was taken over by a Dutch buyer, Utrecht investment company Gilde Buy-Out Partners. Family firm Kinkelder from Zevenaar has some 300 staff and produces industrial  saw blades for the steel industry from three plants in Europa and the US.

Altrex

Last but not least, Parcom Capital took over Altrex . The Zwolle-based 65-year-old manufacturer of ladders, steps and scaffolding – with branches in Belgium and Spain – is seeking further expansion abroad. This is a great example of a niche player that lacks marketing power and financial strength to grow on its own, but suddenly shows progress once it is taken over.