26 Mar LLCP-backed NMi Certin looks at acquisitions, mandates CFI – CEO
LLCP-backed NMi Certin looks at acquisitions, mandates CFI – CEO
26 march 2021
NMi Certin, a Netherlands-based measurement instrument services firm backed by Levine Leichtman Capital Partners (LLCP), is revving up for acquisitions to complement organic growth, CEO Yvo Jansen told Mergermarket.
NMi has hired CFI to identify targets among fellow testing, inspection, certification and compliance (TICC) players, Jansen said. Through LLCP, it foresees hiring law firms and advisers to perform due diligence on potential buys, he said.
The company, which generates annual revenue of over EUR 16m, will finance deals through a mix of debt and new equity from LLCP, he said. LLCP acquired NMi in October 2020 from First Dutch Innovations.
NMi’s services include type approval, such as product conformity assessments; and metrology, the verification of measurement. Its customers include manufacturers of weighing machinery, storage tank operators and law enforcement agencies.
Siemens [ETR:SIE] and General Electric [NYSE:GE] are some of its corporate clients, Jansen said. The Dutch Ministry of Justice, which uses NMi’s legal metrology services in assessing traffic violations, is another customer, he said.
The company will focus on tuck-in acquisitions with up to EUR 5m in revenue, he said. It will also consider larger targets, he noted. Targets should have an EBITDA margin of at least 25%, he added.
NMi will examine both service providers and consultancies, Jansen said.
M&A should extend its geographic reach, bolster its offering and expand its clientele, he said. It aims to establish a direct presence in the UK and Germany, he added.
In the UK, it has a collaboration agreement with a smart metering device assurance laboratory, Jansen said. In Germany, it cooperates with a communication and data security test facility, he said. In both markets, it plans to have assets on the ground as well, he added.
In addition to these markets, it has also earmarked the Nordics for entry on account of the region’s advanced TICC industry, Jansen said. Furthermore, it is interested in hoovering up Belgian and Dutch targets, he said.
NMi aims to beef up its offering of metering services for owners of power assets, such as as wind and solar farms, he said. Moreover, it aims to diversify its portfolio of operational cybersecurity advisory services for equipment manufacturers for original equipment manufacturers and infrastructure owners, he said.
The company has operated at a steady pace during COVID-19 pandemic thanks to its solid portfolio of services and diversified clients in various market sectors and geographies, Jansen said.
NMI has a solid sales pipeline, he said. It is well positioned to benefit from trends like the energy transition-driven uptake of electric vehicles, he noted. It is also well-placed to meet consistent demand for certification from overseas firms eyeing European entry, he added.