testing, inspection & certification€¦ · 2 covid -19 accelerates tic market changes michel...
TRANSCRIPT
Testing, Inspection& Certification
M&A and market trends | 2020
M&A AT THE CROSSROADOF NEW STRATEGIES
2
Covid-19 accelerates TIC market changes
MICHEL DEGRYCK
Managing Partner
“ Digital, sensors and societal
expectations for greater
compliance, wellness and
sustainability are
transforming the TIC market.
This is driving M&A strategies
and supporting historically
high valuations for tech-
enabled players. ”
• The resilient and constantly growing TIC market is facing its first downturn, as a consequence of the Covid-19 pandemic. For the first time, market leaders forecast decreasing revenues in 2020.
• We anticipate 2020 revenues to decrease by 10% vs. 2019 depending on positioning. The most affected players are exposed to the O&G, trade, construction and transportation markets, while the food, security or pharma specialists keep on growing.
• Notwithstanding, the TIC industry remains a sound market that will rebound promptly, driven by historical regulation and outsourcing trends, and increasingly by customer and employee sustainability, compliance and wellness expectations.
• Digital, data and technologies (notably sensors, portable instruments and IoT) are rapidly transforming internal processes, service offers and business models.
• This is creating M&A opportunities for both private equity investors seeking to support emerging tech-enabled players; and for historical market players selling non-core assets and acquiring tech-enabled platforms and new skills.
• The Covid-19 crisis has enabled widespread remote working and digital access to services across every domain. Our belief is that this unprecedented pandemic crisis is a catalyst for all TIC market stakeholders to accelerate digitalisation and implement new service offers.
Capitalmind I TIC M&A report 20202
TECH IS TRANSFORMING THE TIC INDUSTRY AND LIFTING VALUATIONS
KEY INSIGHTS
ADDRESSABLE MARKET FOR TIC PROVIDERS
3
€bn
COVID-19 IMPACT ON 2020 REVENUES
LONG-TERM MARKET GROWTH
Technologies, data and digitalisation are transforming the TIC industry and driving the emergence of new business models
TECH-ENABLED
High valuation multiples are supported by the large combined appetite of listed market leaders, and also by private equity, who are aggressively pursuing buy & build strategies
HIGH M&A INTENSITY
95
-10%
5%
• Accelerated market consolidation is expected, in order to achieve the following objectives:
1. Transform the organization to generate cost savings and efficiencies;
2. Develop new business models that are subscription based and embedded into the client organization;
3. Accelerate globalization and access to new end-markets;
4. Respond to client demand for end-to-end solutions - to better manage and improve quality and safety, risk management, security of people & systems, compliance and sustainability & climate.
3
SELECTED TRANSACTIONS ADVISED BY OUR TEAM
4
sold to
Commodities inspection& testing
Fire safety inspection
sold to sold to
Rail inspection O&G pre-shipment inspection
sold
to
Infrastructure inspection services
sold
to
acquired
Food safety compliance
sold to
Food safety consulting
Agricultural testing services
sold
to
Non-destructive testing
sold
to
CEP Industrie sold to
Fire safety consulting Food Testing Laboratory
acquired
Oil testing and inspection service
sold
to
ETS
Capitalmind I TIC M&A report 2020
Capitalmind has extensive experience in advising deals in the Testing, Inspection a Certificationsector. With 60+ dealmakers across continental Europe, we can help you to achieve yourstrategic ambitions.
Contact us
5
Jonathan ArrowsmithManaging Partner+44 207 597 [email protected]
Guilaume ten HaveDirector+33 1 48 24 63 [email protected]
Ervin SchellenbergManaging Partner+49 1 77 41 32 [email protected]
Marleen VermeerPartner+1 66 96 66 44 [email protected]
Thibault Laroche-JoubertPartner+33 1 48 24 62 [email protected]
Stig Madsen LachenmeierManaging Partner+45 20 433 [email protected]
Michel DegryckManaging Partner+33 1 48 24 62 [email protected]
Jan Willem JonkmanManaging Partner+31 6 20 21 14 [email protected]
Capitalmind is a global corporate finance advisory firm that enables its clients to sell, buy and finance businesses at the best terms.
We are ambitious minds who share one culture, common values and an entrepreneurial spirit. We invest significantly to thoroughly understand your business, and are determined to lead your deals to great success - no matter what!
www.capitalmind.com