Meet Ratos: the New Owner of Semcon. Outbids Etteplan

/ October 2, 2022/ Etteplan, M&A (large, with revenues above $50m), Semcon, Sweden

Ratos Offers A 5% Premium over the Etteplan Offer for Semcon

Etteplan’s offer for Semcon seemed a done deal. The company had received competitive clearance from Swedish Competition Authority (Sw. Konkurrensverket). Its offer’s deadline was close, ending in eight days. And then, Swedish Private Equity firm Ratos outbid Etteplan. The company offered SEK 8m (USD 0.72) per share more than Etteplan, valuing SEK 2,769m (USD 250m). Ratos secured the backing of several major shareholders, including JCE (25.9%), representing 52% of Semcon’s shares. Semcon’s Board of Directors now recommends Ratos’ bid.

Etteplan Pulls Out

Following the announcement, Etteplan reiterated it would not raise its offer. The company amended its guidance for the full-year 2022, acknowledging the impact of M&A costs on its profits.

We had never heard of Ratos, but the name of its CEO, Jonas Wiström, did. You will remember Mr. Wiström as the 2002-2017 CEO of ÅF before ÅF became AFRY with the acquisition of Pöyry. Looking at his LinkedIn profile, Wiström was also CEO of a smaller ER&D services vendor, Prevas, and a board member of Tietoevry for two years. He, therefore, brings plenty of IT services and ER&D industry experience.

Can Ratos Help Semcon Accelerate its Organic Growth

Like another PE firm, Ratos will provide funding to Semcon and accelerate its M&A activity, from one per year. Yes, Semcon suffered from its lack of financial strength. Yet, its true challenge was its lack of organic growth, despite a booming market. Mr. Wiström will need to demonstrate he can help on the organic side, something he had not succeeded in his past years at ÅF.

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