Sights for continued growth
Lacon Electronic GmbH brings HANNOVER Finanz on board and sets sights for continued growth
Hannover/Karlsfeld, 28.05.2019 – In collaboration with Lacon management, HANNOVER Finanz developed a tailor-made participation model for growth and succession. The private equity company, based in Hannover and Vienna, has taken a majority holding in the Lacon Electronic GmbH - a producer and service provider for electronic components and systems based in Karlsfeld near Munich - with a 70 per cent stake. The three-member management team - previously sole shareholders in the high growth medium-sized Bavarian enterprise – re-participated with a 30 per cent owner buy-out. The management of the company, established in 1985, intends to use the equity capital to drive further organic and inorganic growth. It was agreed to keep the purchase price confidential.
Lacon Group products are ubiquitous. They include railway station displays, electromechanical components for brake controllers manufactured by Knorr-Bremse as well as sensors and controls for Würth screw supply units. These systems are backed up by the know-how, assemblies and services delivered by the developer and production service provider for electronic components. The EMS (electronic manufacturing services) provider has 500 plus employees working in the development, production, optimisation and repair of electronic and electromechanical components, equipment and systems in two locations in Germany and Romania. Services include test concepts and global delivery. A key factor is the willingness to produce small series, low production numbers and customised prototypes, such that over the last almost 35 years the company has gained an excellent reputation in industries such as mechanical engineering, medical technology, energy technology, railway technology and robotics. Lacon has received many awards for its systematic innovation management. Over the last fiscal year, the sustainably profitable company achieved sales of Euro 55 million.
Dr. Ralf Hasler, Lacon CEO, who joined the company in 2005 as part of a management buy-in, describes the motivation of bringing a private equity partner into the shareholder group. "Together with HANNOVER Finanz we can achieve our corporate growth at a completely different speed by way of both investments in own technological developments as well as by strategic acquisitions."
In addition, the 53-year-old holder of a doctorate in engineering sees the company facing further challenges which can be better handled backed by a strong financial partner: "The digitalisation of the manufacturing industry as a whole also requires classic EMS services to re-orientate. In a few years time even a simple earthing cable will have integral sensory systems and a data logger. The Lacon Group will be a leader in this field. We intend together with HANNOVER Finanz to transform ourselves from a production-driven service provider into a technology provider."
Markus Mönkhoff, partner at HANNOVER Finanz responsible for Lacon, says of the transaction: "The engagement in the Lacon Group is a typical case for HANNOVER Finanz: We are seeking a long-term interest and will support the management with our know-how gained in other expansion financing. We embrace the expertise of the management and are there to support the company with our interdisciplinary team especially in terms of acquisitions."
Jürgen von Wendorff, economic engineer and member of the HANNOVER Finanz management board responsible for Lacon, adds: "What convinced us above all was the innovative strength of the company and the entrepreneurial management. In addition to growing sales the management also plans the strategic further development of Lacon to achieve higher value stages. This partnership-based participation scheme, structured as an owner buy-out, creates the option of having an equity partner in the shareholder group, maintains existing management structures while at the same time financing further growth. HANNOVER Finanz has more than 40 years of experience with medium-sized enterprises in a variety of situations. We are looking forward to cooperating with our new portfolio company, Lacon GmbH."
In the course of the transaction the HANNOVER Finanz deal team collaborated with the following advisors: Deloitte, Stuttgart (financial, tax), Androschin & Partner (commercial due diligence), PWC Legal, Stuttgart (legal due diligence), Shearman & Sterling, Frankfurt (banking), Yellow Birds Consulting, Ulm (operational & organisational due diligence).
The HANNOVER Finanz GmbH deal team for this transaction included Jürgen von Wendorff, management, Markus Mönkhoff and Joachim von Lohr, both partners, Dr. Christina Silberberger, partner and general counsel as well as Katja Kreutzer, investment analyst.
The Lacon Group
The Lacon Group is a TOP 20 EMS accelerator with over 500 employees in Germany and Romania. The Lacon Group sees itself as a full product realiser in the electronic realm, active both in the investment goods sector as well being a digital and smart mover in the strongly growing IoT market. Lacon boasts broad customer and product bases including broadliners and specialists in all fields, above all railway technology, machine and equipment manufacturing, medical technology, automotive and robotics. The company also produces innovative consumer products. Lacon is active for international technology groups, SMEs and innovative start-ups. In addition to development and production activities, the company also distributes electromechanical components for cable and PCB connection techniques as well as box-building. The main facility in Karlsfeld covers over 14,000 m2, providing space to develop and produce some 12,000 different articles - depending upon a need analysis the EMS accelerator also supports its customers with custom services such as prototyping over industrialisation through to full series across the entire product life-cycle.
The customer base includes both technology groups as well as small, innovative companies. In the last ten years the Lacon Group has accompanied more than 20 high-tech start-ups in the course of prototyping, industrialisation and series production. Lacon develops, optimises and produces electronic and electromechanical assemblies and devices (PCBs, pre-assembled and extrusion cables and wire harnesses, control cabinets, power distribution systems, industrial control systems, medical devices, display systems, sampling machines, measuring and testing equipment).
About HANNOVER Finanz Gruppe
The HANNOVER Finanz Group was founded in 1979 and now boasts more than 40 years of experience; it is independent of groups and banks, backed by institutional investors. The private equity company is based in Hannover and Vienna and was one of the first providers of venture capital in Germany. Well-known business such as Fielmann, Rossmann and AIXTRON have financed their growth with private equity from the HANNOVER Finanz Group and made use of its management consultancy services. The Group also invests in companies when a change of generation has to be secured, and in medium sized spin-offs. The foundations for long-term participation in SMEs is currently based on five active “evergreen funds” with unlimited duration. Investors are primarily insurance and occupational pension funds. HANNOVER Finanz engagements range from traditional industries, to retail, to new technologies. Since it was established the private equity partner for medium sized enterprises has grown continuously as has the number of successfully concluded participations. Typical reasons for investment are finance for growth and succession arrangements for solid medium-sized businesses with annual sales exceeding Euro 20 million. In addition to majority interests HANNOVER Finanz Gruppe is also one of the few investment companies in Germany involved in minority holdings.
Editor: Jantje Salander, Head of Corporate Communications, HANNOVER Finanz Gruppe, Günther-Wagner-Allee 13, 30177 Hannover, Tel.: (0511) 2 80 07-89, Mobile: (0160) 6 33 72 04, Fax: (0511) 2 80 07-33 89, E-Mail: email@example.com, Internet: www.hannoverfinanz.de