Portfolio
Nature of Business
Motoren-Werke Mannheim GmbH (MWM) is a provider of highly efficient and eco-friendly de-centralised power generation systems. MWM focuses on generator setups (gensets), combined heat and power (CHP), trigeneration (heat, power and cooling), as well as complete turnkey solutions. Engines cover a range of 400 – 4,300 kW, using natural gas and non-natural gas.
The company has a particularly strong reputation in biogas and special gas applications, such as sewage, landfill and mine gas. Key customer segments include industrial, agriculture, landfill, sewage, high-tech industries, mining, hospitals, municiples, shopping centres and operators of offshore sites.
Gensets are applied for local consumption or for feeding into the public grid.
The company is one of the world’s leading producers of engines that turn natural gas and non-natural gases into energy. Its head office is in Mannheim, Germany.
Investment Overview
3i backed the MBO of MWM in August 2007 in a €360m deal. The market for de-centralised power generation has immense growth potential. MWM is focused on organic growth facilitated by both general market growth and internationalisation.
As a former subsidiary of German conglomerate DEUTZ AG, MWM was faced with the task of reconfiguring its organisational structure to meet the demands of being an independent, lean and commercially-attuned business. Through our Active Partnership programme we carried out a full potential analysis and identified multiple performance improvement opportunities with the potential of increasing EBITDA by up to €35 million or doubling EBITDA over an approximate 5-7 year horizon.
In October 2010, we signed an agreement to sell MWM for an EV of €580m to US listed industrial company, Caterpillar Inc. 3i will recognise an IRR of above 25% and generate approximately a 2.2x return on investment. The transaction is subject to merger control approval.
