Pitch Best Small Cap 2019: Gilde Healthcare – Eetgemak
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Date deal closed
27 maart 2019
Published value
Undisclosed (Between €25 and 50m)
Buyer
Gilde Healthcare and management
Target
Eetgemak Holding BV
Seller
Value8 NV
Involved firms and advisors sell side
Houthoff (Legal)
Involved firms and advisors target
Marktlink (Management)
Involved firms and advisors buy side
Legaltree (Legal), EY Parthenon (CDD), Sincerius (FDD), JSA Tax (Structuring and Tax DD) ING Bank (Financing)
Brief description deal / Deal outline
Gilde Healthcare, the European specialist investor in healthcare, acquired a majority stake in Eetgemak from stock listed investment firm Value8. The acquisition was the first investment in Gilde Healthcare’s new €200 million private equity fund focused on the healthcare industry. Katwijk based Eetgemak is the market leader in chilled meals for Dutch healthcare institutions Gilde acquired the company in a one-on-one transaction from stock listed investor, a setting that created additional regulatory complexity and is uncommon for lower mid-market transactions. As a result of the proprietary nature of the deal, there was no formal process with no sell-side advisors were involved. Despite these additional operational complexities (e.g. no initial data room, no sell-side materials, limited process coordination, etc.), we managed to complete the DD process and sign the transaction in three months, thanks to the strong support of company management and the outstanding work from our advisors. With the strong support and flexibility of ING’s Leveraged Finance team we were able to structure an attractive financing package, while closing the transaction only 2.5 weeks after signing With Gilde as a new investor, Eetgemak will further expand its market position by growing in both existing as well as new markets, like Belgium.
Deal rationale
Doctors and dietitians increasingly recognize the importance of tasty, healthy food that meets patients’ wishes in the healing process. At the same time, there is a constant pressure on healthcare institutions to work more efficiently and to provide better care with less staff. With an assortment of thousands of different chilled meals, Eetgemak contributes greatly to patients’ and residents’ healing process and well-being, while allowing institutions to focus on their core tasks and reducing overall healthcare costs. As such, the investment in Eetgemak aligns perfectly with Gilde’s philosophy of investing in companies that contribute to better care at lower costs Moreover, Gilde Healthcare considers the market for convenience meals for care and cure institutions highly attractive, with fundamental market trends driving long-term growth, and ample opportunities to win market share. Building on Eetgemak’s market leadership and strong competitive position will allow the company to continue above-market growth at attractive margins. With its in-dept industry knowledge of the end markets and hands-on management style Gilde is the ideal owner to support the company in this next phase of growth
What is the impact of this deal for the company?
Over the past years Eetgemak has shown an impressive growth trajectory, growing from a local founder-owned business to the market leader in its segment. With the support of Gilde Healthcare the company will be able to enter a new phase of development and further growth. Through its longstanding track record and extensive network in the Dutch healthcare space Gilde has a thorough understanding of Eetgemak’s end markets. This allows us to support and challenge management in developing the company’s strategy and to play an active role in Eetgemak’s buy-and-build strategy. The financial support offered by Gilde provides the company with a stable financial basis and enables it to make invest in long-term future growth.
What is the impact of this deal for the direct stakeholders?
As nutrition is the best medicine to a strong and swift recovery, the quality of food provided to patients is of paramount importance. Eetgemak offers chilled meals, which is the most nutrient saving preparation method. More and more healthcare institutions are switching to Eetgemak’s chilled meal offering, which means that more and more patients are receiving healthy, delicious and fresh meals. Growing Eetgemak will further provide career opportunities for its employees and create overall employment opportunities for the local community. As most ingredients are sourced locally this effect will trickle down through its suppliers.
What is the impact of this deal on the society?
With the investments and support of Gilde Healthcare, Eetgemak will be able to grow the business, expand its offering, and win market share, ultimately serving more patients and residents. Since acquisition Eetgemak, with the support of Gilde, was able to acquire two local production kitchens from large care institutions. Transactions that led to an improved offering for residents, while significantly lowering costs
Why does this deal deserve a nomination?
After losing the deal to Value8 in 2012, Gilde maintained a close relationship with company management. This persistence allowed Gilde to quickly strike a deal with the sellers when the opportunity arose by the end of 2018 As the first deal in Gilde Healthcare’s latest Private Equity fund, the acquisition of Eetgemak is a landmark transaction for the fund. To acquire a high-growth company like Eetgemak in a one-on-one setting is unheard of in today’s M&A market climate, demonstrating the strong deal-making capabilities of all parties involved During the six years of ownership Eetgemak proved a very successful investment for Value8. With the support of Gilde the company is uniquely positioned to capitalize on new market opportunities, further building on its leading position in new and existing markets.
