GROWTH STORY AMADYS

Passive equipment, active strategy

For many companies, it can take time to establish a strong and integrated market position outside of their domestic base. Not so for Amadys.

APRIL 2023

ANTWERP-BASED AMADYS was formed in 2016 following a merger of three Belgian businesses, and the founder of one of them, Hein Wilderjans, remains CEO of the group.

All three entrepreneurial businesses had seen the value in building distribution businesses to serve the Belgian utilities and industrial markets, fitting between international manufacturers and local customers.

From 2018, and with local private equity backing, Amadys began to consolidate the market, becoming Belgium’s leading distributor of passive network equipment solutions to fixed and mobile telecom networks, water, gas and electricity grids as well as to general industrial players in Belgium and neighbouring countries.

What the company required for its growth was something that Equistone was uniquely well positioned to help realise.

By 2019, further growth required its domestic success to translate into international success. And for that, Amadys needed a new partner.

For Equistone partner Hubert van Wolfswinkel, it was immediately clear that this was a good match. “The management team had a strong shared vision and intended to remain substantial shareholders, but they were looking for an investor to help them internationalise,” he says. “What the company required for its growth was something that Equistone was uniquely well positioned to help realise. Supported by the fact that we as local team – with Tanja Berg and Marc Arens in Germany, and myself in the Netherlands – covered two of their priority target markets.”

The big question was whether what had worked so well in Belgium could be repeated outside of Belgium. And the answer has been growth as rapid as a high-speed fibre network.

When Equistone invested in Amadys in 2019, revenues were €128m. Today, Amadys revenues are over €400m. This tripling of revenues has come through a combination of strong organic growth and an active acquisitions programme.

Amadys is active in eight markets - Belgium, Netherlands, Germany, Denmark, Austria, the UK, Slovakia and Hungary.

By the end of 2020, Amadys had made its first big move, acquiring Infraconcepts in the Netherlands and becoming a leader in the Dutch market.

At the start of 2021, Amadys made its first acquisition in Germany and has continued to expand. In 2022, it acquired Muth Kommunikationstechnik, a specialist wholesaler for electrical and communication technology and PRO-Kunststoff, a logistics partner for network operators and construction companies, as well as Austrian telecom supplier SKG Netzwerktechnik.

In 2022 Amadys expanded into the UK, acquiring Passcomm which had been operating since 1999 as a systems integrator and supplier of passive network components.

Rapid consolidation

Since Equistone’s original investment, Amadys has made eleven acquisitions.

“The Amadys team has done the deals that they wanted to do, that have been strategic to the group and they have had a high success rate,” says Hubert van Wolfswinkel. “Vendors have been engaged early and the deals have been conducted off-market and exclusively. The Amadys story is compelling for the vendors because there are such strong synergies.”

As well as expanding its geographic footprint, the acquisitions have broadened its offering, making Amadys an even more comprehensive one-stop-shop for customers. The increasing size of the Amadys portfolio of products and services is creating more cross-selling opportunities and providing customers with an integrated solution from a single point of contact.

Another area of focus for the Equistone team has been to advise the management team to ensure Amadys develops as an integrated business. A common ERP system is helping to streamline the integration process and provide a common operational basis for newly acquired companies.

Growth in Amadys’ existing markets is at a fast pace as most of these countries are showing double-digit growth. Amadys was able to keep that pace by reacting early on to changing market environments and customers’ requirements.

Tanja Berg, Investment Director in Equistone's Munich office.

Strong tailwinds

Currently, the telecoms sector represents three-quarters of Amadys’ revenues and investment in telecoms remains exceptionally strong, while the shift to electrification ensures that infrastructure expenditure across all of Amadys’s target regions will continue.

Just tracking market growth puts Amadys on a fast trajectory. “Growth in Amadys’ existing markets is at a fast pace,” says Tanja Berg, “as most of these countries are showing double-digit growth. Amadys was able to keep that pace by reacting early on to changing market environments and customers’ requirements. They were even able to grow market share.”

Hubert van Wolfswinkel, Partner in Equistone's Amsterdam office.

Amadys is maintaining a firm focus on the larger opportunities. The recognition that both the management team and Equistone are contributing to the growth has created “mutual respect and a very positive dynamic,” says Hubert van Wolfswinkel.

Another challenge is maintaining the entrepreneurial spirit while ensuring that the businesses work together under a single corporate framework. “It’s a fine balance and the management team has done an incredible job in keeping the business entrepreneurial, lean and flexible while bringing in control and consistency,” says Hubert.

Amadys shows that there’s no substitute for a truly entrepreneurial management team, observes Hubert van Wolfswinkel. “They have achieved several things at the same time: they have grown market share in a fast-growing market; they have adapted quickly to leading a larger, more complex organisation and have professionalised the business; and they have entered new markets.”

As a result, within three years of Equistone’s investment, the management team is leading a business that is three times larger and operating in seven countries. Asked if this was ‘on plan’, Hubert admits: “Equistone probably thought that it would have taken them more time to achieve that.” ☐

Since publication, Equistone has agreed the sale of Amadys to ETC group, a provider of passive and active telecommunications equipment and tools, with leading technical and logistics solutions for network deployment, upgrades and maintenance.

A full version of this article appeared in PLATFORM 08, Winter 2022/23