Part 1 – By Jonas Schweigart and Philip Herrmann
The refrigeration and air conditioning industry is on the move. This is also reflected in the number of transactions with a volume of over €1 million: since the beginning of 2020, companies in the industry in the DACH region have strengthened themselves through acquisitions or have been acquired themselves more than 100 times. This is also reflected in the valuations. Although these are primarily subject to individual considerations, they have been rising for years and have now stabilized at a very high level. In the following, we will highlight some of the transactions as examples, focusing in particular on the motives of the buyers. Finally, we will venture a look ahead to the rest of the year.
Practical example – Buy&Build with Kälte Eckert
One of the most exciting growth stories in the industry is unfolding in Baden-Württemberg. Back in 2017, VR Equitypartner acquired 70% of the shares in the family-owned company Kälte Eckert GmbH. The company offers specialised commercial refrigeration systems with a focus on industrial applications, commercial kitchens and air conditioning. Under the guidance of VR Equitypartner, Kälte Eckert then embarked on a veritable buying spree starting in November 2019: Within one year, three companies in the field of refrigeration and air conditioning technology were acquired. First, in November 2019, Günther Kältetechnik GmbH (60%), followed in 2020 by Gartner, Keil & Co. Klima- und Kältetechnik GmbH and SOS Kältetechnik GmbH, both 100%. The aim of this ambitious growth strategy is to develop Kälte Eckert into the leading supplier of refrigeration systems in southern Germany. The acquisitions are intended to realize synergy effects both in terms of the geographical coverage of the service network and in the course of joint measures in the area of human resources[1].
[1] https://www.kaelte-eckert.de/wachstum-guenther-kaeltetechnik/
Practical example – Group strategy with Dussmann Group
The example of the Dussmann Group shows that acquisitions in the refrigeration and air conditioning industry are becoming increasingly attractive for larger and internationally active players. The Dussmann Group is an internationally active multi-service company based in Berlin and most recently generated sales of €2.08 billion with approximately 60,000 employees. In April of this year, the group acquired all shares in the Lower Bavarian family-owned company K.E.D. Kälte- u. Klimatechnik GmbH. The reason behind the acquisition is to specifically strengthen the Dussmann Technical Solutions (DTS) division, in which the group combines technical expertise in the field of systems and buildings. With this acquisition, DTS is clearly pursuing its inorganic growth strategy and will be able to boast a stronger presence in southern Germany in the future.[2]
[2] https://news.dussmanngroup.com/presseinformationen/news/dussmann-group-erwirbt-ked-kaelte-u-klimatechnik-gmbh/
Practical example – Diversification with TSG Group
The opportunities that the industry offers for service companies are also evident in the acquisition of Kälte-, Klimatechnik Manfred Wegner GmbH from Wismar, with 98 employees, by the French Tokheim Service Group (TSG). The group employs 800 people in Germany and is primarily active in the areas of fuel technology, vehicle washing technology, electromobility, and payment systems. TSG’s primary target for the acquisition is Manfred Wegner’s existing network of customers in the retail sector, and it also aims to expand its own business in northern and eastern Germany. The acquisition fits in perfectly with TSG’s diversification strategy, which aims to offer a one-stop shop consisting of innovative energy solutions and shopping opportunities at gas stations and similar locations in the future.[3]
[3] https://www.tsg-solutions.com/tsg-group-welcomes-kalte-klimatechnik-manfred-wegner-gmbh-a-new-tsg-company/
Current M&A landscape in the refrigeration/air conditioning industry
The highlight transactions in the industry presented here reveal one particular insight: acquisitions in the refrigeration and air conditioning technology sector are not only highly attractive to medium-sized strategists or financial investors, but also to internationally active corporations seeking to expand or strengthen their existing service portfolio through acquisitions. Potential buyers benefit from the fact that most companies in the industry have come through the crisis without any problems. Nevertheless, a consolidation process has already begun in the industry, offering unique opportunities for larger medium-sized companies as well as financial investors and corporations. Increased M&A activity in the refrigeration and air conditioning industry is therefore to be expected in the coming months. The outlook for the industry therefore remains exciting.
i-capital – M&A expert
As part of the i-unit group, i-capital has had close ties to the skilled trades sector for many years and has successfully supported numerous clients, particularly in the field of refrigeration and air conditioning technology. We assist both private equity-backed companies and medium-sized businesses with acquisitions, support sales in the context of company succession, and take decisive action in the context of restructuring. We also advise companies on their strategic orientation and provide support in financing processes.
Your contact:
Philip Herrmann – Partner
p.herrmann@i-capital.de
+49 151 14 33 96 02
