FCDE sells its stake in Babcock Wanson to Kartesia
FCDE is pleased to announce it has entered into a sale agreement over 100% of Babcock Wanson’s share capital with Kartesia, the European specialist provider of capital solutions for small and mid-sized companies, which will invest in the transaction alongside the Management Team. Following the completion of this sale, Kartesia will take control of a solid Pan- European group, transformed and restructured since the 2016 carve out from its previous shareholder. Kartesia’s and Management’s ambition is to start a new era of growth for Babcock Wanson, with a particular focus on accelerating the Buy and Build strategy initiated under FCDE’s shareholding, combined with the extension of the products related services offered in Europe. The final completion of the transaction remains subject to customary regulatory conditions.
Babcock Wanson is a major European provider of industrial process heating equipment and solutions (primarily boilers and burners) and in the supply of high value-added associated services. The Group is well positioned to capitalize on a growing market, as the supportive regulatory environment aligns the challenges of environmental and energy-efficient improvements expected of European industry. The Group benefits from strong exposure to resilient and growing industries such as the agri-food industry and the pharmaceutical markets. Being active in 8 European countries, Babcock Wanson is ideally positioned to pursue consolidation of a market which remains highly fragmented.
Since the buy-in of FCDE in 2016, the Group has experienced a strong growth trajectory, with sales increasing by 7% per annum and reaching €118m in 2021. This strong performance is the result of the in-depth transformation efforts led with the support of FCDE. During the first three years, the implementation of a 360° transformation plan enabled operational improvements identified on commercial, industrial and financial fronts, including the digitalization of the Group, achieving productivity gains, an increased cash generation - thanks to working capital optimization - and an improved management and financial control set-up. The broad objective was to have all subsidiaries of the Group working together in a common culture and strategy. The second transformation phase was focused on the organic and external development of the Group, with a specific focus on the provision of services. Over the past two years, Babcock Wanson and FCDE have been working side by side to identify, engage and complete acquisitions of European targets. As a result, Babcock Wanson recently acquired three companies, in the Netherlands (3 M€ sales), in Belgium (7 M€) and in France (4 M€), and is under exclusive negotiations to close another transaction in the UK (4 M€).
Upon completion of the transaction, Kartesia will become the new controlling shareholder of Babcock Wanson, alongside a certain number of key members from the Management Team, who will also significantly invest in the transaction. This new step in Babcock Wanson’s story will allow the Group to strengthen its leading position in Europe, increasing its market share through constant investment in operations to maintain the excellency of products and associated services offered by the Group. Simultaneously, Kartesia will support Babcock Wanson in its external growth strategy, capitalizing on the significant pipeline of targets identified under FCDE’s shareholding, coupled with Kartesia’s own knowledge of the European market, supported by its numerous European offices.
Cyril Fournier-Montgieux, Babcock Wanson CEO : “This transaction is an important step for the development of our Group and we are excited to pursue the growth project of our company with the support of Kartesia. Since 2016, FCDE has accompanied Babcock Wanson in its carve out from the Groupe CNIM and in its transformation project, providing the needs to match up the Group’s desired expansion. The strengthening of Kartesia’s stake in our Group will bring additional means to accelerate our development pace both organically and through external growth transactions .”
Julien di Marco, Partner and Member of the Executive Board of FCDE : ”We are glad to have supported Cyril and his team at Babcock Wanson during the carve out process, the transformation and development via external growth in high value added services. We will now hand over to a shareholder who benefits from a deep knowledge of the Group and the required resources to accelerate Babcock Wanson’s growth.”
Damien Scaillierez, Managing Partner at Kartesia : “We are thrilled to increase our level of commitment to Babcock Wanson and its Management Team, following four years of partnership during which we have been able to fully appreciate the Group’s and Management’s expertise and operational excellence. We are confident in our capacity to continue the company’s growth started by FCDE, on the current perimeter of operations, but crucially through our localized knowledge of the European market to provide attractive acquisitions.”