PRIVATE EQUITYNewsletter QUARTERLY SPECIAL | EDITION 4/2018

CLOSED DEALSin 2018 within the German-speaking region

NEW DEAL FLOWJanuary - December 2018in German-speaking region

MOST RECENT STUDIESby Roland Berger

Private Equity NewsletterQuarterly Special | Edition 4/2018

Roland Berger2

We hope you had a good start to 2019, closing recent deals and investigating new opportunities. This edition of the Newsletter provides an overview of the deal flow in the fourth quarter of 2018 and examines various developments influencing the private equity market. Additionally, it provides an overview of recent Roland Berger studies.

PE-related deal activity within the German-speaking region was again very strong in 2018 with 205 closed deals, matching the level of 2017. New deal flow held up well throughout the entire year. In terms of industries, deal activity was highest in Engineered products and Consumer goods, fol-lowed by IT/Telecommunication and Healthcare; in comparison, Transportation, Chemicals and Energy displayed a lower deal activity while Automotive remained solid.

During 2018, macroeconomic indicators across Europe developed slightly unfavorably. Grow-ing political worries and related implications for the global economy resulted in a few clouds on the horizon. Although, the US reached an all-time peak thanks to buoyant consumer spending, growth in the rest of the world appeared to be slowing down. China and the US risked a trade war as the US imposed tariffs on Chinese products and China responded with tariffs of its own. Addi-tionally, the US imposed duties on various import products (e.g., steel) from Europe, Canada, Mex-ico and other countries. And the outcome of the ongoing Brexit negotiations still remains unclear. Political instability in Italy further impacted the global markets and may also raise the concerns of investors going forward.

The most recent study by Roland Berger’s Operations Practice addresses the hot topic “Adaptive Operations – Why the Next Crisis shouldn’t be a Crisis”. Companies appear to increasingly lose the ability to react organically and adaptively to external changes and trends. Therefore, they lose their agility, the skill to co-evolve with their environment. Often enough, a crisis does not have to be a crisis if a permanent adaptation becomes the imperative trend and “Operations” is used as the backbone. With this study, decision makers obtain concrete recommendations to drive profitabil-ity and to mitigate risks – tailored to the specific industry’s trends.

Other recent studies address topics around the mega trends of artificial intelligence. Publica-tions include “10 theses about AI – A companies’ eye view of the future of AI” and “Riders on the storm: Procurement as a driving force of AI” as well as digitalization with “Business ecosystems – Partnership of equals for corporates, SMEs and startups”. The study “On a wing and a prayer? – Challenges and opportunities in the aerostructure supplier industry” takes a view on consolidation opportunities via a buy-and-build strategy and investment options in the aerospace market.

The Roland Berger Investor Support Practice wishes you a good flow of leads and successful transactions in 2019, with which we are looking forward to supporting you wherever we can.

Yours sincerely

Dear Friends, dear Clients,

Dr. Thorsten Groth

Dr. Gerd Sievers

Marc Hesse

Dr. Sascha Haghani

Christof Huth

Sven Kleindienst

Sebastian HaineChristof

HuthDr. Gerd Sievers

MarcHesse

Dr. Sascha Haghani

Dr. Thorsten Groth

Sven Kleindienst

Sebastian Haine

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CLOSED DEALS IN GERMAN-SPEAKING REGION 2001 - 2018 # closed PE-relevant dealsSource: Roland Berger

2001

40

2002

74

2003

81

2004

104

2005

10020

17

2018

204 205

2006

163

2007

166

2008

122

2010

136

2011

113

2012

12520

15

161

2016

168

2013

110

2014

119

2009

79

Closed deals for 2018

The number of closed deals in 2018 amounted to 205, which is at the previous year’s level.

In 2018, the leading deal makers in terms of number of deals were Waterland Private Equity Invest-ments with seven deals, AFINUM and AUCTUS Capital Partners with six deals each, followed by capiton, H.I.G. Capital and Triton Partners with five deals each. AURELIUS and Nordic Capital record-ed four deals each.

Deal activity in 2018 remains strong

32

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118 118 122140

Jun Sep Dec

22

13 11

3

314

14

18

18

39

34

30

Mar

10

83

17

35

May Aug Nov

1813

10

8

14

15

40

28

46

Feb

35

6

26

67

Apr Jul Oct

10

25

14

26

30

27

39

56

46

Jan

11

26

38

1

5

DEAL FLOW PER MONTH IN GERMAN-SPEAKING REGION Jan - Dec 2018# deals by statusSource: Roland Berger

2018 saw a continuously strong deal flow with 498 deals in total compared to 464 deals in 2017 and was characterized by a stable deal flow, with peaks in the months of February and July.

Following the strong activities of Q1 with 140 new deals coming onto the market, the deal flow slightly reduced during the second, third and fourth quarter with around 120 deals in each quarter. Nevertheless, 2018 again represents another year with a very high level of PE activity in the German-speaking region.

Current WithdrawnRumored Dormant Closed1

2018

1 The difference in “closed” deals in the deal flow statistic (on this page) compared to the “closed deals” statistic (on the preceding page) is due to the time delay between announced deals (in deal flow statistic) and legally closed and signed deals (in closed deals statistic)

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118 118 122140

7

77

14

6

9

6

10

15

39

56

37

Apr Jul

3

7

6

6

10

38

1

2

3

Jan

21

6

1

5

2

8

88

1211

40

28

21

1

5 45

May Aug

8

5

41

14

21

1

67

4

9

Feb

6

14

3

10

39

Jun

7

11

2

3

7

4

9

34

Sep

8

6

23

6

16

46

Oct

9

1

4

5

8

13

46

Nov

6

3

1

10

10

30

Dec

7

2

2

7

14

35

2Mar

11

3

DEAL FLOW PER MONTH IN GERMAN-SPEAKING REGION Jan - Dec 2018# deals by industrySource: Roland Berger

5 6

2018

IT/TelecomsTransportationOtherConsumer goods

ChemicalsAutomotive Energy

Engineered productsHealthcare

The PE market in the DACH region once again saw the highest level of activity in the indus-tries Engineered products and Consumer goods (151 and 90 deals, respectively), followed by IT/Telecommunication and Healthcare with 60 and 54 deals. Furthermore, Automotive recorded a very solid level of deal activity with 53 deals, while the Transportation, Chemi-cals and Energy industries showed a more moderate deal flow.

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TARGETTARGETDeutsche Fachpflege doctariDornier Consulting InternationalDPG Deutsche Pflegegruppeebm Maschinenbau

EES ScholzElatecelements.at New Media SolutionsElgato SystemsEMDE Industrie-TechnikEMS Elektro Metall Schwanenmuehle

ESIM ChemicalsETC - Enterprise Training Center

evitriaewit (123makler)

FairConnectFEBA AutomationFLSForte WarmebehandlugFranke IndustriesFutura Retail SolutionsGerhard MutschlerGermanFlavoursGermanPersonnel e-searchGfSGIATAGiesserei AlbbruckGmyrek Fleisch- und WurstwarenGothaer FahrzeugtechnikGreif-VeloxGS StarGundlach Automotive CorporationGutekunstH. Vollmer

Halex HoldingHansefitHeimomed HeinzeHeizkurier

IBYKUSIKB LeasingInfoniqa PayrollINNIO (formerly GE Industrial Engines)Inomed TechnologyIPANISPINItertalklinik Seniorenzentrum

KADIKAMAKBLKGS SoftwareKlapper AutoteileKlinikzentrum Muehlengrund Bad WildungenKMLSKnauer-UniplastKytoLanger & Laumann Ing.-Buro

Larsen Indoor Light Concept

Lautsprecher TeufelLearnship Networks

50Hertz Transmission7days Marc Staperfeld A+R Betriebsgesellschaft

ABC DesignABO Flitertechnik NordACT IT HoldingAEMtecAGVS HoldingAir AllianceAlbrecht & Dill CosmeticsAllgeier Medical ITAlloheim Senioren ResidenzenalphaBit

ALVI - Alfred ViehhoferAmann Girrbach APZ Auto-Pflege-ZentrumArcadia HotelbetriebsA-ROSA FlussschiffAscoraASIC RoboticsAVS VerkehrssicherungBamaBauwerk BoenBBS AutomationBeam ShopBeinbauer AutomotiveBellissa HaasBerliner Synchron

BE-terna GroupBetter TasteBFC FahrzeugteileBigCityBeatsBoes GroupBollAnts SpaBosal ACPSBosch Mahle Turbo SystemsBOTABrugg KabelC. HübnerCareerFoundryCasekingCBR HoldingCCC GermanyCeramTec

ChainMaster Buehnentechnikcharismathicscoeo Inkassocompassio

Competence Call CenterConcept

Contus GruppecopperING

Copytrend HoldingCordenkaCotesa

COVERIS Rigid (Zell) Deutschlanddatadirect

DEINZERDermedisdetailM

ACQUIRERACQUIRERAdvent InternationalVitruvian PartnersPalero CapitalBregal UnternehmerkapitalWilhelm Altendorf (Avedon Capital Partners)HCS Group (H.I.G. Capital)Summit PartnersValantic (AUCTUS Capital Partners)Corsair (Eagle Tree Capital)Deutsche Invest Capital PartnersUndisclosed bidder (Luxembourg-based family office)Sun European PartnersAspire Education Group (Quadriga Capital)AFINUMPlanetHome (AP Capital Investments and Deutsche Invest Capital Partners)Palamon Capital PartnersPiab Invest (EQT Partners)DBAGHalex Holding (Liqid Investments)Europoles (VTC)Elvaston Capital ManagementZKK HoldingFlavourtec (Tar Heel Capital)RiversideFinatemOdewald & CompagnieNavigator CapitalEquistone Partners EuropeFinatemBPE Private EquityAUCTUS Capital PartnersGilde Buyout PartnersME Capital Advisory & ConsultingLDBS Lichtdienst (Beyond Capital Partners)Bencis Capital PartnersWaterland Private Equity InvestmentsAtos Medical (PAI Partners)Odewald KMU Gesellschaft fuer BeteiligungenVM Capital AdvisorsHPS Investment PartnersElvaston Capital ManagementAdvent InternationalInitiative & Finance Capital TransmissionCastik CapitalcapitonAlloheim Senioren Residenzen (Nordic Capital)Invision Private EquityPremium Equity PartnersDIH Deutsche Industrie-HoldingMaxburg Capital PartnersAlliance Automotive Group (Blackstone)Waterland Private Equity Investments

Syngroh CapitalBlue CapVerdane CapitalOdewald KMU Gesellschaft fuer BeteiligungenLDBS Lichtdienst (Beyond Capital Partners)Naxicap PartnersTHI Investments

KfW BankengruppeSliverfleet Capital PartnersSchoenes Leben Group (Waterland Private Equity Investments)Invision Private EquityWaterlogic (Castik Capital)CONET Technologies (H.I.G. Capital)capitonSüd BeteiligungenDPE Deutsche Private EquityECM Equity Capital ManagementRVC (MainCapital)Nordic CapitalSwiss IT Security (Ufenau Capital Partners)Noppies (Vendis Capital)Capvis Equity PartnersVR EquitypartnerGHotel (AURELIUS)Duke StreetDRS InvestmentParagon PartnersTriton PartnersSerafin UnternehmensgruppeEGS BeteiligungenEQT PartnersSaltation BeteiligungsgesellschaftH.I.G. CapitalAlveus BeteiligungenBTI Studios (Shamrock Capital Advisors)DPE Deutsche Private EquityAURELIUSTriton PartnersBeyond Capital PartnersCross EquityH.I.G. CapitalTowerBrook Capital PartnersFountainVestchicco di caffe (Paragon Partners)SOLIFOS (HVD Partners)Patrimonium Private Equity AdvisorsVerdane CapitalGilde Buyout PartnersAlteri PartnersHR Group (capiton)BC Partners, Ontario‘s Pension Plan and Public Sector Pension Invesmtent BoardLIFTKET Hoffmann (AFINUM)Drivelock (Nordwind Capital)Waterland Private Equity InvestmentsSchoenes Leben Group (Waterland Private Equity Investments)ArdianMB Mittelständische BeteiligungsgesellschaftAUCTUS Capital PartnersGehring Technologies (Penta Investments)Helvetica CapitalBMC EuropeIntegrity Capital Partners and QFAT investmentLindsay Goldberg VogelFernao Networks (AUCTUS Capital Partners)Leo Family HoldingRigeto UnternehmerkapitalArcus Capital

DEALS CLOSED IN 2018 WITHIN THE GERMAN-SPEAKING REGION

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TARGETTARGETSLR GusswerksmavaSportsman‘s Delight (Pyua label)Starz Supernaturalssurf4shoesSwiss Education GroupSwiss Medical Imaging InvestmentSwyx SolutionsTENADOThe Packaging GroupThurn ProdukteToproTrafolubetrendtours TouristikUmbrella OrganisationUNICEPTA Gesellschaft für MedienanalyseVAGVentomaxxVerkehrssicherungen PlankVTU HoldingWBackWDM (Wolfshagener Draht- und Metallverarbeitung)weka Holzbauwibit SportsWohanka, Obermaier & Kollegen, Ü-Werk and Enssner Zeitgeist TranslationsWuppermannXELOGZargesZeit Fuer Brot Holding

LedlenserLet‘s go FitnessLindenfarb Textilveredlung Julius ProbstLinimedLogis

Lucht Probst AssociatesMagix SoftwareMaschinenbau Hebrock

MEAMED Medical Products

MediaPark Klinik Betriebsgesellschaft

Medical Onemefro wheels

MeinAutoMetanomics Health

microGLEITminCamMungo Befestigungstechniknavabinetzkontor nordNKE Austria

NL-Holding NordseeNorres SchlauchtechnikOberberg Klinik VerwaltungOberScharrer GroupORSOFTOskar NoltePerconexPERLKÖNIG Perlen & Schmuck & ZubehörPferdeklinik Grosswallstadt

Phoenix MetallPloucquet

PRIME Research

ProbstProcrea GroupProspitaliaRaetz GerüstbauRail & Road Protec (r2p)RamederRasselstein RaumsystemeRatioparts Ersatzteile-VertriebsRECATReifen KriegRepair Concepts

Robert BuerkleRodenstock

Safe CroniteSauter FedernSchema HoldingSchletterSchroth Safety ProductsSecura IndustriebeteiligungenSHW WerkzeugmaschinenSilexicaSimply Logistics Systems

ACQUIRERACQUIRERGienanth (DBAG)Vitruvian Partners and Runa CapitalSPIN capitalNorthCapitalNordwind CapitalHR Group (capiton)Summer CapitalRAD-x (Gilde Healthcare Partners)Waterland Private Equity InvestmentsMaxburg Capital PartnersHQ EquitaQuantum Capital PartnersSerendipity PartnersHCS Group (H.I.G. Capital)Bregal UnternehmerkapitalMidoco (AFINUM)Paragon Partners

AURELIUSAFINUMAVS Verkehrssicherung (Triton Partners)DPE Deutsche Private EquityPPC PartnersCross Equity

Outdoor Life GroupArgos WityuAUCTUS Capital Partners

Lafayette Mittelstand CapitalDRS InvestmentWerner Co (Triton Partners)AFINUM

AFINUM and Invision Private EquityNaxicap PartnersRADIAL Capital PartnersGHO Capital PartnersIT Beteiligungs (Alpina Capital Partners)Motive PartnerscapitonWilhelm Altendorf (Avedon Capital Partners)ADCURAM GroupVision Ophthalmology Group (Stirling Square Capital Partners)ATOS Kliniken (Waterland Private Equity Investments)MediDate (Earlybird Venture Capital)Accuride Corporation (Crestview Partners)HgCapitalBiocrates Life Sciences (ARAX Capital Partners)Coventya (Silverfleet Capital Partners)Harald Quandt IndustriebeteiligungenFinatemVerdane CapitalDBAGGersa Bearings (Going Investment Gestion)Oaktree CapitalKharis Capital AdvisoryTriton PartnersTrilantic EuropeNordic CapitalAlpina Capital PartnersPeter MoehrleKiegerMaxburg Capital Partners

Altano Gruppe (Ufenau Capital Partners)Fidelitas IndustrieholdingCONSTANTIA Beteiligungs (CBAG) and TECHTEXCONSTANTIA Beteiligungs (CBAG) and TECHTEXAlveus BeteiligungenNL-Holding (Oaktree Capital)Nordic CapitalB+P Group (AURELIUS)HQ EquitaFSN CapitalBWKInvestcorp and The Riverside CompanyElemental HoldingFintyre (Bain Capital)Fair Damage Control Holding (Ufenau Capital Partners)AUCTUS Capital PartnersCompass Partners (Bridgepoint Capital)CicladPinova CapitalIK Investment PartnersGolden Square CapitalPerusa PartnersPerusa PartnersSFO-GruppeEQT PartnersFloris Capital

DEALS CLOSED IN 2018 WITHIN THE GERMAN-SPEAKING REGION

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Presenting Roland Berger’s most recent studies

Adaptive Operations – Why the Next Crisis shouldn’t be a CrisisThe ever more frequent disruptions seem to be an inevitable consequence of the acceleration revolution. However, that is not the case. Most crises are not disruptions. They do not come overnight, and they are not black swans. Almost always, they cast their shadows and, almost always they are recognizable by a multitude of signals and forerunners. The thing is just that: companies tend to solidification and consolidation. They lose the ability to react organically and adaptively to the external changes and trends. They lose their agility, the skill to co-evolve with their environment. Often enough, a crisis does not have to be a crisis if a permanent adaptation becomes the imperative trend in the corporate culture and corporate structure. The backbone of the business are the „Operations“, e.g., In-novation, Procurement, Production or Supply Chain. Therefore, it is the key imperative for all corporates to create „Adaptive Operations“.We have reached out to more than 300 top managers across all industries, to capture their view on their expecta-tion for the economy and their priorities for 2019. About half of study respondents anticipate a downturn for 2019 – Last year, a large proportion still expected a boom. Our 10th edition of the „Operations Efficiency Radar“ summa-rizes the results per industry. Furthermore, decision makers obtain concrete recommendations to drive profitability and to mitigate risks – tailored to the specific industry‘s trends.Please send an email to melanie.habrock-michels@rolandberger.com, if you are interested into the complete report.

10 theses about AI – A companies’ eye view of the future of AIArtificial intelligence (AI) has evolved from a mere buzzword to a veritable megatrend – A game changer for the industrial era. More and more companies have become aware of the opportunities afforded by AI and are grafting the technology into their existing businesses or using it to create new business models. Globally, the US is still the leader, hosting not only the digital giants that are investing in AI on a grand scale, but also the largest number of AI startups. That said, China, too, is investing heavily in AI. Indeed, it is plotting a clear path to overtake the US by 2025 and dominate the global AI market by 2030. European countries have some catching up to do. In April 2018, the European Commission therefore announced the outlines of an European strategy, details of which should be made known by the end of the year.This study formulates ten theses from a companies’ eye view: 1. AI calls for strong leadership; 2. In the age of AI, corporate strategy makes the difference; 3. In the short run, AI will further increase the dominance of internet giants and platforms; 4. Portable AI could render the likes of Google irrelevant; 5. AI will replace company silos with pow-erful value networks; 6. AI drives systemic risks; 7. When AI algorithms collude, companies pay the price; 8. Hu-mans and AI will team up to innovate; 9. Managers will be held accountable for AI’s wrongdoings; 10. A new balance in data privacy must be found.

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For further information, questions or remarks please contact:

ROLAND BERGER GMBHInvestor Support, Sederanger 1, 80538 Munich, GermanyJosipa Gotovac, Phone +49 89 9230-8250, Fax +49 89 5485-8250, josipa.gotovac@rolandberger.com

Riders on the storm: Procurement as a driving force of AIThe disruptive developments that accompany digitalization mean that the question of how to strategically and operationally reinterpret the strategic role of purchasing needs to be asked. In the operational arena, the combined use of RPA (robotic process automation) and AI (artificial intelligence) in particular can prove to be an important efficiency lever. That is because there is large potential for automation in highly integrated, complex and globe-span-ning value chains. Software robots can perform particularly repetitive and standardized tasks (such as verifying invoices), which works by mimicking human interaction with user interfaces without needing any comprehensive architectural changes in IT. In Roland Berger‘s survey of 87 CPOs of Global Fortune 500 companies, 67% of the CPOs ranked AI as one of their top 3 priorities for the next 10 years. The Executive Vice President & Chief Procurement Officer of Philips Electron-ics, Fredrick Spalcke, summarized the key rationale for AI as follows: „The CPO is the ‚CEO of spend‘ and needs to think end-to-end, from the consumers to the suppliers. AI is the only way to manage this end-to-end because it is overwhelming for individuals to manage that amount of data without these tools.“

Business ecosystems – Partnership of equals for corporates, SMEs and startupsDigitalization is more than just a technological revolution, it is a revolution in transaction costs within and between com-panies. Sharp boundaries between industries and companies are disappearing in its wake. What are emerging are business ecosystems that can respond to customer needs in a brand-new way. New customer needs are no longer sat-isfied by innovations from within a company‘s own value chain but by a network of partnerships. Business ecosystems cut the Gordian knot that binds many a failed innovation project. They make it possible to overcome the barriers and obstacles of internally driven innovation projects by developing the value proposition for the customer not from within the supply chain alone but by establishing a partnership of equals within the framework of an ecosystem. And transforming a company‘s value chain into a value network of multiple partners.The study has been developed together with ITEM – Institute of Technology Management of the University St. Gallen. More than 40 case studies and 200 interviews with orchestrators and complementors served as basis for the analysis and conclusions.

On a wing and a prayer? – Challenges and opportunities in the aerostructure supplier industryCommercial aerostructures industry is a promising market but growth will slow after 2020 driven by a lack of new aircraft programs, the slow down or end of life of existing programs (e.g., A380, B747) as well as the increases in production rates but also sights of reduced shipset prices (e.g., A320neo, B737max). As growth slows, OEMs and aerostructure suppliers must rethink their strategies. Thus, OEMs are looking to cut costs, control the market by leveraging dual sourcing strat-egies and insourcing some work packages. Suppliers must embrace change and reinvent themselves to become indis-pensable by excelling with respect to production cost (e.g., automation) and technology leadership (e.g., use of advanced materials).Aerostructure suppliers need to take a proactive role in shaping consolidation (vertical and horizontal) to optimize their position in the value chain to stay on the winning side.The study has been enhanced by the findings from more than 20 interviews conducted with key aircraft OEMs and aerostructure suppliers in Europe as well as the Americas.