Pitch Best Deal Mid-Cap 2020: Astorg – Normec Group
De beste deal van het jaar is meer dan het hoogste cijfertje in de krant en de kunst van het dealmaken is meer dan het opstellen van een contract. De Awards voor de beste deal zou dus niet alleen op de prijs van de deal gebaseerd moeten zijn, maar vooral op de – toegevoegde – waarde voor een bedrijf en de exit.
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Name of the deal: Astorg Partners acquires majority stake in Normec Holdings
Date: Announced 19 June 2020, closed 5 August 2020
Published value: < €250 Million
Buyer(s): Astorg Partners
Target: Normec Holdings
Seller: Summit Partners
M&A Database: View more details of the deal
Involved firms and advisors sell side:
ING Bank (M&A Advisory), EY (Tax Advisory), NautaDutilh (Legal Advisory Corporate M&A), Astorg Partners (PE Management), Latham & Watkins (Legal Advisory Corporate M&A)
Involved firms and advisors target:
Normec Holdings (In house Corporate M&A), Jefferies, DeBreij (Legal Advisory Corporate M&A)
Involved firms and advisors buy side: Atlas Fiscalisten (Tax Advisory), KPMG (Financial Due Diligence), deBreij (Legal Advisory Corporate M&A), De Brauw Blackstone Westbroek (Legal Advisory Corporate M&A), Summit Partners (PE Management), Kirkland & Ellis (Legal Advisory Corporate M&A)
Pitch
Brief description deal / Deal outline
Astorg Partners, a European private equity group, in partnership with management acquired Normec Group, a leading provider of testing, inspection, certification and compliance (TIC) services, from global growth equity investor Summit Partners, Normec's founder, Joep Bruins, and the wider Normec management.
Normec Group assesses and supports the quality and safety of materials, systems and products by conducting independent audits, tests and inspections based on accredited methods. Normec Group particularly operates in the Buildings, Environment & Infrastructure and Food & Agriculture market segments.
As part of this transaction, a large group of managers was interested to re- and co-invest together with Astorg Partners and Normec's founder, Joep Bruins, to make the next steps with the Normec Group, which reflect their positive view on the Normec Group and its business. A sophisticated participation and acquisition structure was designed to cater for each party's needs. This scheme was implemented at closing, less than 2 months after the start of the transaction.
Why should this deal win the Award for Best Deal 2020?
Normec Group, mainly active in the Benelux and Germany, has experienced a spectacular growth since its inception in 2016 through the acquisition of over 20 leading specialist providers. The legacy of these acquisitions proved to be a challenging aspect within the transaction. Multiple sellers had earn-out or other rights that needed to be settled or rolled-over into the current structure.
Over the last years, TIC services proved to be a business that is increasingly sought after, as more and more activities are becoming regulated. Normec Group itself is also heavily regulated. The regulatory diligence into accreditations for various services in multiple jurisdictions was at times challenging and required in-depth knowledge of the TIC business.
Considering that Normec Group was deemed one of the most attractive assets in the market, it was paramount to Astorg Partners to act in a swift manner. Because of the excellent cooperation of the various transaction advisors over multiple jurisdictions, the diligence review was finalized within less than a week, and signing could take place only one week after the start of the diligence.
All the above was only possible because of the close collaboration between Astorg Partners and its various advisors in various jurisdictions, and the smooth cooperation with the sell side advisors.
All in all, to complete this whole transaction regarding one of the most attractive assets in the Benelux market, with businesses in multiple jurisdictions, during the COVID-19 pandemic, within only two months was an exceptional achievement.
Deal rationale:
With the partnership between Astorg Partners and Normec's management, Normec Group is well positioned to continue its growth path in the also growing TIC market. This is key to strengthen and build out an attractive value proposition for the clients of Normec Group. It further secures the continuation of the high quality of the services provided by Normec Group, which is expected from and required for a company in the TIC business.
What is the impact of this deal for the company?
As part of this transaction, a large group of managers was interested to re- and co-invest together with Astorg Partners and Normec's founder, Joep Bruins, to make the next steps with the Normec Group, which reflect their positive view on the Normec Group and its business.
What was most complex about this deal?
Over the last years, TIC services proved to be a business that is increasingly sought after, as more and more activities are becoming regulated. Normec Group itself is also heavily regulated. The regulatory diligence into accreditations for various services in multiple jurisdictions was at times challenging and required in-depth knowledge of the TIC business.
Considering that Normec Group was deemed one of the most attractive assets in the market, it was paramount to Astorg Partners to act in a swift manner. Because of the excellent cooperation of the various transaction advisors over multiple jurisdictions, the diligence review was finalized within less than a week, and signing could take place only one week after the start of the diligence.
A sophisticated participation and acquisition structure was designed to cater for each party's needs. This scheme was implemented at closing, less than 2 months after the start of the transaction.
