Another major investment group gains ground in the horticultural industry. HAL Investments, the Dutch investment subsidiary of HAL Holding, has signed agreements to acquire 60% of the shares in Stolze and to acquire 24% of the shares in Prins Group. "HAL Investments is working on a new portfolio of companies in the horticultural supply chain that can support each other on an individual project basis for large, complex and international projects that are increasingly initiated by investors", they explain.
Horticultural suppliers
Dutch companies Stolze and Prins Group are both family busineses, active worldwide in the greenhouse sector. Stolze is a global player providing technical systems for horticultural greenhouses. Prins Group is one of the independent greenhouse builders in the Netherlands, generating approximately 90% of its turnover abroad and intending to grow substantially in the coming years.
HAL is the Dutch investment subsidiary of HAL Holding N.V., an international investment company that is listed on the Amsterdam Stock Exchange via HAL Trust. HAL has a diverse portfolio of internationally active companies. The net asset value of HAL amounted to € 13.7bn at the end of 2019.
Geert van Veen, CEO of Prins Group, ‘This is a fantastic moment for our company. Many private equity investors have approached us in recent years, but HAL was the obvious choice. We need growth capital to stay at the forefront internationally, but not at any price. The continuity of our family business, securing employment for our employees, and the prospect of an incredibly dynamic future with a new stable shareholder who's committed for the long term were the key considerations for us.’
Projects by Prins Group, completed in China and in progress in The Netherlands.
As said it's also the growing roll of the investors that this decision was based on. ‘Unlike in the Netherlands, these large projects usually come to us first,’ says Van Veen. ‘It all starts with a greenhouse exterior. And when that is finished, there is a whole range of systems that need to be installed inside. We are often asked to provide turnkey solutions for these kinds of projects. To do that, you need close collaboration with reliable partners who understand each other in doing business internationally. Partners you can work with to practically solve the challenges that come your way. HAL's plans are promising. We have already worked on a number of large projects with Stolze, but HAL wants to bring in even more specialised companies that can be the point of contact for large growers and investors looking for integrated cultivation solutions, including all the services that go along with it.’
The other members of the Prins Group management team, Nico van de Laar, Sebastiaan Vroegop and Rob Schulte, also characterise the move as ‘a great development for the company’. ‘Not only will HAL give us extra resources for expansion, we can also benefit from the experience they have with growing international organisations. We are looking forward to working together.’
International expansion
The enthusiasm is no less with Stolze. ‘Our new shareholder has a strong strategic vision for future developments in the international horticultural sector. And that vision is in line with ours, especially around what we need to achieve our growth goals and international expansion in the coming years,’ says Jilles Goedknegt, Stolze CEO.
Part of that vision is using targeted participations to form a group of leading horticultural companies to complement each other in the supply chain for horticultural projects. ‘That could include a wide range of companies, from greenhouse builders and automation companies to service providers. Together, these companies can respond to the growing demand from investors for turnkey solutions in America, Asia, the Middle East and Russia. These are horticultural projects that are becoming larger and more complex and require greater collaboration between specialist suppliers,’ says Goedknegt.
Theo Stolze says that in the Netherlands, the grower usually the one buying systems for their own greenhouses, while abroad it is often investors who are looking for complete cultivation solutions. ‘The importance of system quality and integration is growing every day. Systems are becoming more complex and increasingly critical for crop controllability and yield. HAL has a keen eye for these developments, too, and their plans to procure an interest in greenhouse builder Prins Group are proof of that. If we don't head down this road now, in just a few short years, we'll be falling behind.’
‘HAL Investments will bring us significant added value to managing the growth we want to achieve in the coming years,’ adds Niels van den Ende. ‘In addition to being a stable, financially strong shareholder, we will be gaining a partner with expertise and clout that is can help us professionalise our business processes, attract new talent, and expand our range of services nationally and internationally. At the same time, we want to continue being the family business we have always been, a company with short and accessible lines of communication. HAL's own story makes them very sensitive to that aspect of the business.’
The receipts
Shareholders Niels van den Ende (MT member and Benelux Commercial Manager), Theo Stolze (Export Manager) and Carel van Ruijven (Operations Manager) will continue to operate as shareholders within Stolze. Sales of the company over 2019 were € 95 million and Stolze employed circa 120 FTE. The company has offices in Maasdijk and Aalsmeer in the Netherlands. Abroad, Stolze maintains a network of dealers and has service points in multiple countries that provide service to local customers. Stolze was advised on the transaction by Triple Group, the knowledge and network centre for greenhouse farming chains.
Prins Group currently has offices in Kwintsheul and Dokkum, with global net sales of approximately €37 million at the end of 2019 and approximately 44 FTEs. The Van Veen family will maintain a shareholding with founder Geert van Veen (CEO, 56), son Tom (25) and son-in-law Marco Zwinkels (35), both in charge of commerce and MT team members. Prins Group was advised on the transaction by Bram Breederveld from Blaak & Breederveld Accountants.
Both transactions are subject to standard conditions for transactions of this nature, including approval by competition authorities, and are expected to close in the first quarter of 2021.