Beyond Capital Partners acquires Ounda

Each formerly family-owned business in the group has revenues of €500,000-1.5m and the companies were acquired effective as of 1 May 2020.

Ounda's managing directors, Dieter Meis and Heinz-Jürgen Petri, own a 10% stake in the company. The former shareholders of the optician chains have sold their shares.

Asked about how the deal came about, BCP managing partner Christoph Kauter told Unquote: "The buy-in management team approached us in 2019; in Q3 we evaluated the market, carried out market due diligence with EY, looked at the market growth potential and established relationships with suppliers for procurement. The conversations with owners took place before and at the start of the coronavirus outbreak. We did an asset deal to make sure that there was no risk for March-April."

The GP deployed equity via Beyond Capital Partners II, which is set to hold a final close in H2 2020. The vehicle is targeting €125m, compared with the firm's first fund, which had a total volume of €25m.

Debt was provided by Bright Capital, which acted as lead arranger, and HF Debt, a subsidiary of Hannover Finanz. Leverage is around 3x EBITDA and EV is less than 1x the company's revenues of €11m.

"The entire business is very cashflow-creative, so some of the add-ons will be financed with cashflow generation, but some could be made through equity from our fund or future debt sponsors," said Kauter. "But the focus is to keep the cash in the company to grow the business and to become a dominant market player, since the segment is ultra-fragmented."

Kauter described the splintered optician market in Germany: "Fielmann, for example, is the market leader with around 1,300 branches, and we are now number 10 in terms of size, so it's a good place for consolidation. In Germany particularly, roll-ups in sectors like dental, clinics, hospitals and care homes are common. Optician consolidation took place in France and Benelux, for example, some time ago."

Paragon's ProOptik and Argos Wityu's AktivOptik are examples of PE-backed strategies that have been implemented in the German market. However, BCP is focusing on smaller targets and on the premium part of the market.

Ounda plans to buy up to 80 further opticians in total, giving the company a presence in 100 locations. "We currently have a longlist of 50 businesses. We plan to add 12-15 by the end of Q3 2020, and 35-40 locations next year. In the next two to three years there will be 80-100 branches with total revenues of €40-50m," said Kauter.

The business has proved resilient to problems caused by the coronavirus lockdown, Kauter said. "Opticians belong to the list of exempt businesses during the crisis, so they were allowed to keep their shops open – revenues were down in March and April to around 50-60% of a regular month, but in May it was back to 75-80% and we expect it to be fully in line for June and July."

"This goes hand in hand with the focus on the premium segment," Kauter added. "The kind of clientele who will for example pay €600-1,500 for glasses is much less sensitive to any crisis, and their consumption is not changed that much over the next few months. Others like the larger price-volume driven opticians have a lower average basket price; their customers might delay their shopping execution to a safer time, but from day one our assumption was that the premium market would be strong. The business is asset-light and has the potential for long-term 4-6% margin compound annual growth."

Company
Ounda currently reports turnover of €11m across 20 locations in German federal states including Berlin, Bavaria, Schleswig-Holstein and North Rhine-Westphalia. The business is headquartered in Münster. Ounda reports EBITDA of less than €2m.

People
Beyond Capital Partners – Christoph Kauter (managing partner).
Ounda – Dieter Meis, Heinz-Jürgen Petri (managing director).

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