Nord Holding invests in Ewerk

The company's managing directors and founders, Hendrik Schubert and Erik Wende, will remain in their management roles and have retained a minority stake in the company.

Christoph Grunewald, investment manager at Nord Holding, told Unquote how the deal came about: "Ewerk engaged Quarton as an M&A adviser, who ran the auction process, and we were approached in early October. We previously invested in PDV, a document management software provider focused on regulated clients, so they knew that we were aware of the space and the requirements of its end customers."

Philipp von Mitzlaff, an investment committee member at Nord Holding, added that the GP is familiar with the sector: "Our dedicated software & technologies team had been engaged in the sector and wanted to build a platform there for around two years. So when the auction started, we were well-prepared and knew what to screen and how to get to the finish line."

Grunewald added that the process drew interest from a number of different bidders: "The company has been historically approached by strategic investors on a regular basis, but the founders and the management wanted to find a financial sponsor to execute the growth strategy they had in mind. We do of course know that there was an auction process run by Quarton – there were around three parties towards the final stages of the process, which went down to two and then us."

Nord Holding plans to pursue a growth strategy that will continue the strategy of organic and inorganic growth first implemented by the company in 2018, according to a statement. The GP will also assist the company with its expansion into new business areas, such as Business Process Outsourcing.

The GP will also make targeted add-on acquisitions. It already has a number of businesses in mind and will focus on building the company's presence in the DACH region. Grunewald told Unquote: "While conducting due diligence, we had already screened some suggestions provided by the management. From a list of 20 targets, there already have been initial conversations with three to five. We are looking to pick this up relatively soon after the final closing."

Grunewald added that there is significant competition for such targets in the sector: "There are a lot of financial sponsors interested in the space, and you will always have strategics trying to pick up smaller specialised teams, so there is a lot of competition. Not every add-on target fits everyone equally well. But the faster we are, the better."

Nord Holding generally invests in companies with revenues of €20-500m and EBITDA of €5-15m, with an enterprise value of around €100m. The GP focuses on investments in software and technology, healthcare, smart industrials, consumer and business services.

Company
Founded in 1994, Ewerk provides IT services including software design and development, transition management, and data centre and infrastructure management.

The company has 200 employees and has offices in Berlin, Zurich, Wolfsburg and Bayreuth, in addition to its headquarters in Leipzig. It generates revenues of €15-30m.

People
Ewerk – Hendrik Schubert, Erik Wende (founders, managing directors).
Nord Holding – Andreas Bösenberg (managing director, investment committee member); Moritz Merkert, Christoph Grunewald (investment managers).

Advisers
Equity – Noerr, Holger Ebersberger (legal); WDP, Christoph Nichau (commercial due diligence); KPMG, Philip Pejic, Florian Geiger (financial due diligence, tax).
Company – Quarton International (M&A).

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• Buyouts
• DACH
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• Nord Holding