Routeco Group Holdings
Catalyst advised Routeco Group Holdings (Routeco) on the sale of the business to Sonepar SA of France. Routeco is the UK’s largest independent distributor of industrial automation and control products. Based in Milton Keynes, the business was started in 1978 and has national coverage with 13 branches across the UK, as well as having operations in Austria and the Netherlands. Routeco has been an authorised distributor for Rockwell Automation for over 20 years, which has helped it to achieve its market leading position. In 2010, the founders led an internal management buy-out which gave the management team a 35% shareholding. By 2014, the founders wanted to realise the remainder of their shareholding and leave the business completely and they appointed Catalyst to advise them on the sale of the business.
What difference did we make?
The transaction process started with a strategic review which included pre-screening a short list of large multinational strategic acquirers that we knew would have a strong interest in Routeco. This allowed us to run a tailored sales process which presented Routeco in a way that matched the strategic objectives and acquisition timetable of each potential acquirer. One of these potential acquirers was Sonepar SA of France, the independent privately-owned global market leader in the B2B distribution of electrical products and related services. It viewed Routeco as a highly strategic asset and entered into exclusivity with the business. Sonepar serves customers in 41 countries and has a total turnover of more than €16 billion; none of which in the UK. As an established distributor with significant market share, Routeco represented a strong platform to enter the fragmented and highly competitive UK market.
We project managed the whole transaction from start to finish. We managed the sales process to take account of Sonepar’s timetable; this included negotiating the reinvestment by Routeco’s management team and negotiating exchange control provisions while Austrian merger approval was sought. We protected value throughout the sales process, completing the same deal that was in Sonepar’s indicative offer. Sonepar’s acquisition of Routeco provided a full exit for the founding shareholders whilst the management team shareholders were able to retain a stake. Management will run the business as a separate unit within Sonepar Northern Europe and help support the expansion of the automation business into Europe.