Bolster Investment buys 60% stake in Mark Climate Technology

Company director Piet-Hein Bruinsma and the management team will retain a 40% stake in the business.

Mark van Rijn, partner at Bolster, explained how the deal came about: "In the first instance it was a proprietary deal via a mutual connection, but other relatives who were also owners of the company were also involved. An auction process was run by ING Corporate Finance, but after the process the family decided that they wanted to work with us – they talked to other possible investors but in the end they saw that what they wanted was in line with us."

Asked about whether the coronavirus lockdowns in place across much of Europe had an impact on the process, van Rijn said: "We had a mutual agreement about the price and completion, and after the Dutch government introduced the lockdown, we put the deal on hold for several weeks to do scenario testing, and the bank who provided the debt funding also wanted to do more homework and wanted more information. It was quite an event for the transaction. In the end we came to a good arrangement and there was less than a month delay."

ING provided debt financing for the transaction. The company has an enterprise value of €50-100m.

The company plans to make add-on acquisitions of European peers following the investment, van Rijn told Unquote. "The company has €40m revenues, so typical buy-and-build candidates will have €5-25m. In terms of geography we will look for companies in the US and western Europe, with a special focus on agriculture climate system producers. The company itself is very active in industrial buildings and we see a lot of opportunity for agriculture in the sector. Usually those companies have around a 10% EBITDA margin, and Mark Climate has around 20% EBITDA margin, which is more efficient by industry standards."

Bolster is currently deploying equity from its debut fund, which held a final close in February 2018 on its hard-cap of €160m. It deploys equity tickets of €5-20m and plans to make 12-15 platform investments in total, targeting Netherlands-based B2B companies. It has an 18-year investment structure and generally invests in minority staks. The fund is around 50% deployed and Mark Climate is its eighth platform investment.

Company
Mark Climate produces climate control systems to manage temperature and air handling in industrial and utility buildings. The company also comprises the subsidiaries StaticAir, which produces machinery to reduce fine dust in the air, and CMK Luchttechniek, which installs and designs air ducts and ventilation systems.

Founded in 1945, the company is based in Veendam and has 200 employees. It also has sites in Germany, Belgium, Ireland, Poland and Romania, as well as an additional production site in Ireland. The company was taken over by the Bruinsma family in 1983. It generates revenues of €40m and the company reports EBITDA of €7-8m.

People
Mark Climate Technology – Piet-Hein Bruinsma (director).
Bolster Investment Partners – Mark van Rijn (partner).

Advisers
Equity – De Breij (legal); Simcerius (financial due diligence).
Company – ING Corporate Finance (M&A); Criman (legal).

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• Topics
• Buyouts
• Benelux
• Industrials
• Netherlands