Acrotec Group & Axial Medical
Middle Branch Partners advised the Acrotec Group during their agreement to acquire Axial Medical
About The Acrotec Group
The Acrotec Group of Develier, Switzerland brings together unique and complementary skills in the high-precision manufacturing and technology markets. They are present in the Medtech, A&D, watchmaking, transportation and electronics industries.
Their products and services include:
Medical implants and instruments, pumps and micro-bearings for implantable devices.
Custom spindles and probes for the medical, A&D and transportation markets.
Complex components, tooling and machines, as well as chronometric measuring devices for the mechanical watchmaking industry.
Precision manufactured complex transportation components such as turbochargers.
The group’s companies are in Switzerland, France, Ireland, Singapore and now, the United States.
Acrotec Group is a portfolio company of The Carlyle Group’s London office (NASDAQ: CG).
Acrotec’s operating structure allows a high degree of independence for entrepreneurial and family-owned businesses. Acrotec-owned businesses are not combined or controlled in a centralized way that can often stifle the forces which have made the businesses successful in the first place. Often, the complete management teams stay in place.
Where possible, additional resources are brought to bear for the benefit of all Acrotec group companies. This facilitates the transfer of knowledge and information within the group, exploits synergies in the purchase of machinery and equipment and supports the sharing of services. For example, an Acrotec Group Research & Development unit exists to create new technologies for the benefit of the Group’s companies
Our Work
M&A Strategy
Acrotec’s strategy is global but was without a significant presence in the USA. The company had recently done transactions in Ireland and Malaysia and needed to expand in the USA, especially in MedTech but did not know all the players in the middle market. With this goal plus our deep knowledge of the US MedTech market allowed us to target Middle Branch Partner’s known small select group of buyer prospects for Acrotec - without a broad unfocused approach to the market.
M&A Due Diligence
Middle Branch Partner’s advisors performed a careful review of the Acrotec Group and opportunities in the US MedTech market. Our team then created and contacted a very focused list of strategically aligned prospective sellers.
Evaluating Acquisition Opportunities
After creating and contacting our targeted and focused list, Middle Branch Partners found a potential mutually beneficial arrangement between Acrotec and Axial Medical, a family-owned and Warminster, Pennsylvania-based precision MedTech contract manufacturer. Axial Medical’s strategic focus is on the long-term growth of their customers and capabilities across MedTech categories. Our team confirmed that an acquisition of Axial Medical would fit with Acrotec’s M&A strategy. This included an ongoing leadership role for key ownership and management.
Negotiating the Acquisition
After initial analysis, Acrotec confirmed that Axial Medical was an attractive acquisition because of its entrepreneurial management team & approach, independence, unique capabilities, strategic fit and service offerings to existing and future customers. Once it was determined that proceeding with the deal was mutually beneficial, our advisors began facilitating the acquisition discussions with both the buyer, seller and investor (The Carlyle Group). This included discovery trips to Axial Medical and to Acrotec in Switzerland by Middle Branch Partners and/or the joint management teams.
Results
After initial analysis, Acrotec confirmed that Axial Medical was an attractive acquisition because of its entrepreneurial management team & approach, independence, unique capabilities, strategic fit and service offerings to existing and future customers. Once it was determined that proceeding with the deal was mutually beneficial, our advisors began facilitating the acquisition with both the buyer, seller and investor (The Carlyle Group). This included discovery trips to Axial Medical and to Acrotec in Switzerland by Middle Branch Partners and/or the joint management teams.
“When Carlyle invested in Acrotec, we knew we had an ambitious investor and partner who would support our growth objectives, which included the expansion of our business into the large and growing Medtech sector. Axial provides the perfect entry point for Acrotec in the US-market, and we are delighted that such a high quality and complementary business is joining our family. This deal will significantly strengthen our Medtech division and open up new opportunities for further bolt-on M&A in the US.”
CEO of the Acrotec Group