Kurt Salmon and KPMG advise on Boards & More deal

06 December 2013 Consultancy.uk

End-November, private equity company EMERAM acquired Boards & More, one of the largest producers of Kitesurfing and Windsurfing products in the world. The investors paid approximately €39 million for the Austrian company. EMERAM was assisted by, among others, consulting firms KPMG and Kurt Salmon during the transaction.

Boards & More has four well-known brands in the Kitesurfing and Windsurfing market: North Kiteboarding, North Sails, ION and Fanatic. The company is based in Molln, Austria, and has revenues of €45 million (FY2012).

EMERAM is a private equity company that focuses on purchasing promising SMES companies in Germany, Austria, and Switzerland.

Kurt-Salmon-en-KPMG-begeleiden-Boards-&-More-deal-8051

During the transaction, EMERAM hired Kurt Salmon to perform a commercial due diligence. Big 4 company KPMG executed both a financial due diligence and supported the PE-company with tax services.

“The experience and the network of EMERAM will not only enable us to significantly grow our existing business, but also expand into new segments, thus taking Boards & More to the next stage of its development”, says Till Eberle, CEO of Boards & More. The company recently entered the market for high performance bike wear and with the capital injection it aims at boosting its presence in the market.

Legal advice came from bpv Hügel (one of Austria's top law firms), Wenger & Vieli (a German law firm) and Watson, Farley & Williams (an international law firm).

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Consumer goods start-ups grow interest from venture capital

23 April 2019 Consultancy.uk

Funding the latest consumer goods start-up has been a real money-spinner for venture capitalist firms, with a number of $1 billion companies – or unicorns – having emerged in the space in recent years. New analysis has explored the resulting corporate consumer products activity in the acquisitions space.

Consumer products have enjoyed years of strong growth as new markets opened in developing Asia. China in particular has enjoyed strong growth across a range of consumer good types as the country’s middle class expanded. Private equity firms have been keen to pick up targets in the space as they expand their portfolios to include additional local capacity as well as customers in new markets.

As a result, a study from Bain & Company has found that interest from PE firms in the consumer product space grew sharply in 2018, hitting 6.1% of all invested capital for the year, and making it the third most sought-after category. It is now only behind financial services (23.9%) and advanced manufacturing and services (13.9%).

Corporate venture capital investment

The ‘M&A in Disruption: 2018 in Review’ research found that growth in the segment reflects key changes in the segment as a whole. This is particularly true of insurgent brands, which often leverage local expertise in order to take on international giants in domestic markets.

Short change

The market changes have led to shifts in motivations for consumer goods company investments from PE firms. The number of strategic investments stood at 50% in 2015 compared to deals that increased scope. This has shifted significantly, with 34% of deals focused on strategic outcomes in 2018 compared to 66% for scope. The move towards scope reflects companies seeking out fast-growing products that enable stronger revenue growth streams.

Acceleration in scope-oriented M&A in consumer products

However, there were other motivations for deal activity in the space. Activist investors have put pressure on companies to expand their portfolios in recent years, with the trend expanding from just US targets to Europe.

Further trends

The other key shift in the space regards outbound deal activity. The study found that outbound deal activity has increased significantly in the Americas (up 363%) with total deal volume up only slightly (15%). Key deals included Coca-Cola and Costa, Procter & Gamble and Merck’s consumer health unit, and PepsiCo and SodaStream. In the Asia-Pacific region, outbound deal activity rose 195% while total deal activity fell sharply, by -36%. The EMEA region saw both a sharp decline in outbound deal activity, at -68%, as well as lower overall deal activity, which fell by 32%.

Cross-regional deal making

Deal-making in the current environment is increasingly fraught with uncertainties, as business models change on the back of new technologies, new consumer sentiments and wider market changes from new entrants. As such, acquisitions are increasingly useful as possible hedges on changes in market direction. As such, companies are increasingly pressed to take a future-back position, making sure to incorporate a vision of how the company needs to look in five years into acquisition strategy.

The firm notes that certain acquisitions which enhance a remembrance of a nobler mission, revive a sense of entrepreneurialism and engage directly with consumers may be necessary qualities in acquisitions that transform a company to fit market expectations in the coming decade. While going forward, focus on innovation, partnering with retail winners, reducing cost base and constantly reallocating scare resources will be necessary to protect market share in areas where insurgent local and strategic competitors are active.

Related: Private equity asset growth top priority for 2018.