Dutch m&e giant Imtech has bought contractor Goodmarriott and Hursthouse. Andrew Brister hears how the group has big plans for UK expansion.

Imtech? Never heard of them. You soon will do: the Dutch giant aims to be among the top three m&e contractors in the UK within five years. This summer has seen them step up activity with the purchase of Goodmarriott and Hursthouse, adding to 2003’s buyout of Meica. Imtech UK now boasts a combined turnover of around £110 million in its technical services businesses.

“I see this as the opportunity to take Goodmarriott and Hursthouse to the next step in its development as a major player in the electrical and mechanical building services sector,” said md Trevor Hursthouse. “The move secures the long-term future of the business and provides key staff with an opportunity to develop professionally outside the private owner environment.”

The business, strong around its Nottinghamshire base in the Midlands and with an office in West Yorkshire, will complement Meica’s activities in London and the South East of England. Meica and Imtech UK chief executive Jim Steele explained the strategy: “Goodmarriott and Hursthouse will continue to be run by the existing team and there will continue to be a commitment to the expansion of current services, supported by Meica’s strength in the London market.”

Steele views Meica’s mechanical contracting expertise as a potential benefit to Goodmarriott and Hursthouse and there will be further gains from group purchasing power and other synergies.

The move secures the long-term future of the business

Trevor Hursthouse

Looking ahead, Steele sees more purchases before too long. “We’ll let the dust settle on this one and then we’ll have a look. Group objectives for developments in the UK revolve around strategic geographic acquisitions for quality stand-alone businesses.”

The group is believed to have looked at a number of m&e contractors, including a major player with over £200 million turnover. “The strategy is to buy good businesses. By that, I mean a turnover of more than £20 million, trading profitably for a number of years, with net profits of 2½ – 3%.” Steele is keen to avoid crossover with existing operations, so is particularly looking at the North East and North West of England and the Cardiff area.

With many medium-sized contractors thinking that now may be the time to achieve maximum value for the business, Imtech’s fax machine is going to be buzzing over the next few months.

Who is Imtech?

Imtech UK is the holding company for business operations of Imtech NV in the UK. Imtech is a multidisciplinary technical services provider working principally in the electrical, mechanical and information and communication technology sectors throughout Europe.

The group is based in the Netherlands and the shares of Imtech NV are quoted on the Dutch stock exchange. Last year, annual turnover exceeded 2 billion euro, with profits (EBITA) at over 78 million euro (3·8% margin).

Imtech has operations in Belgium, Germany, Luxembourg, the Netherlands, Spain and the UK and employs over 13 000 staff serving more than 10 000 clients. Almost half of turnover comes from Germany, where Imtech is the market leading m&e contractor, with 32 offices around the country.

Anatomy of a sale

Succession planning has featured heavily in recent ECA conferences. Trevor Hursthouse, 62 and with his children happily working outside the firm, is not alone in having to focus on the future of the family business.

“Around three years ago, I decided I had to make a decision about the long-term strategy and ownership of the business,” said Hursthouse. “The options were: a management buyout (mbo), a trade sale or the venture capitalist route. You must allow your staff the look at the mbo and give them the chance to make their own decision.”

In this case, the staff didn’t take up that option so he pursued a trade sale. “We were looking for somebody bigger, possibly with a European interest, as ultimately contracting will be a European business.” A host of potential acquirers was rapidly whittled down to four where “they really drilled down into the financial data”.
Imtech proved to be the best option for Hursthouse. “The Dutch came over and they made me feel very comfortable. This was a very straightforward negotiation; it’s been a great experience and brought a lot of confidence.”

Imtech buys stand-alone businesses and lets them get on with it. “It’s been very hands-off,” says Hursthouse, who will be staying on. “I’ve a job to do in the next 2-3 years creating an environment where the business can operate without my executive day-to-day input.”

Source

Electrical and Mechanical Contractor