Active Capital in EUR 150m fundraise; SIF strategy and portfolio companies eye buys

Active Capital will tap family offices, entrepreneurs, high net-worth individuals (NWIs) and institutional investors — including pension funds and funds of funds — to back the planned fund, Huige said. 

The new fund will focus on “anything with a warehouse” in the Netherlands and Germany, including equipment manufacturers and technical wholesalers, Huige said. The reshoring of overseas industrial production to Europe in general, and to Germany in particular, is anticipated to generate a wave of investment opportunities for the fund, he said. 

Mid-to-smallcap dealflow in these segments is lively, Huige added: “We are receiving more investment proposals,” he said. 

The sponsor’s last fund, Active Capital IV, raised EUR 85m. 

Profile 
Active Capital buys into Dutch and German industrials-linked enterprises generating EUR 2m-7m in EBITDA, Huige said. The sponsor, in keeping with environmental, social and governance (ESG) commitments, selects businesses with the potential for reduced carbon emissions and more efficient use of resources, he said. 

By the time Active Capital exits a portfolio company — preferably via a trade sale — EBITDA is usually in the range of EUR 10m, Huige said. Active Capital’s recent divestments, for undisclosed sums, include an 80% stake in German lighting system developer, SchahlLED, to FW Thorpe for an initial EUR 14.6m consideration; and Dutch vacuum system producer, Amphitec, to truckmaker RSP, for an undisclosed sum.  

Like other sponsors, Active Capital has seen its cost of capital increase, Huige said. It reduces the impact of high funding costs by transforming portfolio companies operationally and eschewing purely acquisition-led growth, he said. “it’s all about adding true value to a company.” 

In addition, while limited partners (LPs) are growing more exacting vis-à-vis funding proposals, Active Capital expects its emphasis on “niche strategies” to attract backers, Huige said. 

In parallel, Active Capital’s EUR 25m Special Investment Fund (SIF) is on the cusp of a first buy, Huige said. The SIF targets industrial companies facing such challenges as complex corporate carveouts and cashflow issues. 

Add-ons 
Among Active Capital’s portfolio companies, VDM Industries (VDMI) plans to diversify its offering of environmentally-responsible cleaning agents via selective German, Belgian, UK and Nordic bolt-ons, Huige said. Yuno Advisers is conducting the search, he said. VDMI’s offering includes washing-up liquid, hand soap and bleach. In addition to its Piek and Dammol lines, it produces unbranded liquids on a contract basis.  

Another Active Capital investment, textile manufacturer FibrXL is interested in absorbing distributors in adjacent geographies such as the UK and Belgium, Huige said. FibrXL develops and distributes industrial fabrics, including polyester and viscose. Through FibrXL Performance (formerly Eurofibers), it wholesales special purpose yarns for use in PPE and in sports articles such as hockey sticks. Through FibrXL Industrial (formerly Lumat), it supplies nylon for ropes and hoses. 

Other sectors of interest include chipmaking, whose strategic status in an era of reshoring should generate business, Huige said: “This is still a very strong, buoyant sector.” Active Capital-owned German semiconductor equipment developer, Werner Lieb, has seen orders surge, he said. 

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• Topics
• Funds
• Buyout
• Investments
• Benelux
• DACH
• Industrials
• Netherlands
• Germany