Across Europe, testing, inspection and certification (TIC) is a fast-growing €15bn sector, characterised by long-term customer contracts and the need to meet legal requirements.

In 2006, Alan Giddins, 3i’s Global Head of Business Services, identified the sector as an investment priority.  “The attractions of TIC were clear and we wanted to commit significant resources to it over a number of years,” he says.  “All we needed was a highly credible industry leader to help us make the most of the opportunities.  That leader was Ad Verkuyten.”

Having just led the transformation of Röntgen Technische Dienst, a Dutch TIC group, Verkuyten was well placed to help 3i achieve its ambitions in the sector.  Following a review of over 40 European TIC businesses, 3i acquired Inspecta in June 2007.  The company is based in Finland and also has significant operations in Sweden and the Baltic states.

As Giddins observes, “Ad gave us the perfect capability to assess a range of TIC opportunities.  When we undertook due diligence on Inspecta, he took part in every meeting and introduced us to new sources of specialist skill.  He wasn’t simply an adviser – he was right at the heart of the process.”

Following the acquisition, Verkuyten became the new Chairman of Inspecta and initiated a range of measures to position the company for growth:

• Leading the recruitment of a new CEO and CFO;
• Streamlining the company’s existing operations to create a more integrated cross-border structure;
• Strengthening Inspecta’s M&A capabilities.

Verkuyten’s impact on the business quickly fed through to the bottom line, as Giddins notes: “In the first year alone, Ad’s leadership grew profitability by 20%,” he says.  “Equally importantly, Ad has positioned Inspecta to expand into further European markets, and achieve its goal of being one of the most profitable, capable and respected businesses in the pan-continental TIC sector.”

... its structure and enter new markets.

Skilled leadership and a close partnership with 3i provided French transport company Keolis with the financial and relationship resources it needed to streamline its structure and enter new markets.

When 3i acquired a majority shareholding in French transport operator Keolis, it was clear that skills in public-private partnership would be key to the company’s success: its core business was operating buses for local authorities, and state rail company SNCF remained a major shareholder.

Michel Bleitrach, a 3i Senior Adviser at the time, was appointed CEO in 2004.  With a background of leadership roles in utilities giant SUEZ, he brought an intimate understanding of relationship-building and contract negotiations in the French public sector.

To complement Michel’s skills as CEO, 3i also introduced two other business leaders to the Board.  Michel Lamboley joined as CFO, his financial skills proving invaluable in the subsequent refinancing and restructuring of Keolis.  Jean-Michel Mauvilly came on board as a Non-executive Director and helped to cement strong shareholder relations through his strong relationship and board role with another SNCF company.

To meet the challenges posed by domestic restructuring and international growth, 3i and the Keolis board undertook a structured review of the management capabilities within Keolis to identify where there were skills gaps that were subsequently filled by an infusion of fresh leadership talent.

The partnership between business leaders and 3i helped Keolis to become a streamlined operator winning major new contracts at home and abroad.  During 3i’s 2004-06 participation, Keolis’s turnover rose to more than €2.5bn, its profits rose by a third and its value almost doubled to €1.075bn.  Today the company’s transformation is regarded as one of the great success stories in France.

When 3i’s investment team in China opened their dialogue with highly successful fast-food chain Little Sheep, Nish Kankiwala was a vital element in building 3i’s credentials.  As the former President of Burger King International, his industry knowledge was second to none.

By flying to Beijing to spend several days with Little Sheep’s management team during the early discussions, Kankiwala demonstrated 3i’s commitment to the relationship and the deep levels of expertise on which 3i could call – a vital factor in the eyes of the company’s founder Zhang Gang, who was being actively courted by a wide range of potential partners.

Following 3i’s US$20m investment in Little Sheep in mid-2006, Kankiwala joined the board as a Non-executive Director and made an important contribution to the company’s growth, drawing on the deep understanding of consumer behaviours he gained at Unilever and PepsiCo.

Kankiwala’s global experience was particularly valuable to Little Sheep as it streamlined its franchise system, and identified the right balance between international expansion and the considerable opportunities in the domestic market.

During the first 18 months of 3i’s investment, Little Sheep achieved year-on-year revenue growth of 40%, a remarkable degree of success even for China’s buoyant food market.

In June 2008, Little Sheep had a successful IPO in Hong Kong at a valuation of around US$400m.  The value placed on Kankiwala’s contribution by his fellow directors was clearly demonstrated when they asked him to remain on the board post-flotation.

A complementary blend of skills from four highly-respected business leaders have set German manufacturer NORMA on the path to achieving its ambition: becoming a €1bn global business in industrial connectors and connecting solutions.

A renowned provider of connecting technology, NORMA Group has long been a leading light of Germany’s Mittelstand and was determined to become a true global player.

3i’s acquisition of NORMA in 2006 was the culmination of a complex and sensitive six-month process.  To help complete the investment successfully and get the vision for the company off to a flying start, 3i worked with four business leaders in different yet vital roles:

• Hamdi Conger, a respected Senior Adviser for 3i, played a critical role during the deal execution and then became Chairman, providing inspirational leadership and driving international growth from the beginning.
• Another 3i Senior Adviser at the time, Walter Münnich, engaged effectively with the management team and contributed his in-depth sector understanding during the deal process to articulate the value that partnership would bring.
•  Joachim Wöge, a highly-respected CFO, quickly came on board as an invaluable interim Finance Director once the investment was completed.
• Dr. Peter Stehle, an esteemed industry expert and a well known figure in the market joined the Supervisory Board of NORMA.

Since 3i’s investment, the company has strongly grown organically and completed two transformational acquisitions in Europe and the USA, and is on course to achieve the hugely-ambitious goal it has set: €1bn annual turnover by 2012.

Working alongside the 3i investment team, these leading industry figures have made an immeasurable contribution to NORMA’s success. 

Fortuitously, Nish Kankiwala chose to work with 3i as a Senior Adviser at the start of 2006, just as the opportunity arose to acquire UK-based baby products group Mayborn, renowned for its Tommee Tippee and Sangenic brands.

3i completed the acquisition of Mayborn in July 2006.  The deal valued the company at €200m and took private an AIM-listed business that was still strongly influenced by the family that had owned it for decades, led by Michael Samuel.

With Nish’s impressive general management record in world-class consumer businesses such as Unilever, PepsiCo and Burger King, he was ideally placed to lead Mayborn’s brands to the next level.

As 3i Partner Jennifer Dunstan explains: “Nish worked with us from the very beginning to evaluate the opportunity, and gave 3i and Michael Samuel (previous CEO), complete confidence that he would be a highly-effective CEO who would promote Mayborn internationally.”

During his time as CEO, Nish’s leadership has made a vital contribution to Mayborn:

• A complex series of operational enhancements enabled non-core businesses to be sold at full value.
• Product and branding innovation saw the launch of the “Closer to Nature” range.
• An international focus has taken non-UK sales from c30% to c50% of turnover.

As Mayborn’s impressive growth and profitability trends continue, Jennifer Dunstan summarises Nish’s capacity for adding value: “Nish is a truly international leader, who’s as strong operationally as he is strategically.  It’s a rare combination.”

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