DGAP-News: Rödl&Partner Study: German Mittelstand finances growth increasingly with venture capital
(firmenpresse) - DGAP-News: Rödl&Partner GbR / Key word(s): Study/Private Equity
Rödl&Partner Study: German Mittelstand finances growth increasingly
with venture capital
03.05.2012 / 11:30
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Rödl&Partner Study: German Mittelstand finances growth increasingly with
venture capital
- Venture capital firms focused on Mittelstand companies expect positive
development
- Cleantech, ICT and healthcare leading industries for venture capital
firms
- Bavaria most attractive German state for venture capitalists - Berlin
jumps to 4th place
Frankfurt/Munich, 03.05.2012: The private equity industry is benefitting
from growth in the German economy. More and more German Mittelstand
companies are financing their strategic expansion with venture capital.
Venture capital firms focused on Mittelstand companies therefore expect a
positive development in the venture capital market - despite intense
competition for attractive investments and ever increasing company prices.
This year more than 90% of venture capital firms plan to agree to new
investments. The first target is cleantech companies, followed by the ICT
and healthcare industries. These are the findings of the private equity
study drawn up by the international consulting and audit firm Rödl&Partner.
'Today venture capital firms are indispensable as finance partners for
Mittelstand companies', explains Wolfgang Kraus, Managing Partner at Rödl&Partner. 'At the same time the companies profit not only from the venture
capital. Venture capital firms also bring in their expertise and drive the
strategic development of their equity interests. This support is very
important especially in the current boom of taking over companies in crisis
in order to transform the opportunities on offer into an economic success.'
However, the conditions in the venture capital market have become rougher.
Strategic investors and family offices are intensifying the competition for
attractive investment targets. This is driving company prices up and up. In
addition, many family-owned companies are able to finance their expansion
from their own liquidity. Given this background venture capital firms are
increasingly adapting to meet the requirements of Mittelstand companies.
For the first time the number of minority shareholdings has reached 56%.
Venture capital firms are less frequently demanding direct influence by
posting managing directors. In the place of short-term investments,
long-term equity investments now have become more common - 75% of the
companies report an average holding period of 5 years and longer.
'The capital market is opening up and is reaching out to Mittelstand
companies', emphasises partner Björn Stübiger, who drew up the study. 'The
investment of venture capital in Mittelstand companies is an indicator of
further economic growth. The venture capital industry is looking for
success stories. The reason is that a successful partnership must result in
disposal with a profit. Mittelstand companies promise an attractive return
on equity.'
While venture capital firms focused on Mittelstand companies view the
future optimistically, investors focused on deals over 100 million euros
are more sceptical. The reason for this is most likely that it is becoming
increasingly difficult for venture capital firms to find investors for
their investments. Transactions under 5 million euros are therefore more
and more completely financed through own funds.
Industry focus: Cleantech frontrunner for the first time before IT and
healthcare
The most attractive industry for venture capitalists is the cleantech
industry, i.e. companies concerned with environmental technology. In the
context of the global changeover to alternative energy sources this
industry has now become a frontrunner and forced the ICT industry down to
second place. The healthcare industry is in third place. In spite of the
boom in the German industry, fields which depend on the economic climate
such as mechanical engineering and the automotive industry are a long way
behind in positions four and six.
Bavaria in front of NRW and Baden-Württemberg as most attractive region for
the venture capital market
In the face of the cluster initiatives in cleantech, ICT and healthcare
companies in Bavaria and North-Rhine Westphalia it is no wonder that these
German states are also able to keep their top rankings as the most
attractive investment locations for venture capital firms. Baden
Württemberg in third place has a successful technology sector and is a
location for a dynamic mechanical engineering and automotive industry.
Berlin is for the first time in fourth place - here the conditions for
company start-ups are currently being improved in the ICT and media fields.
Conclusion: Venture capitalists are able to cover the financing
requirements of Mittelstand companies
'The venture capital industry has successfully adapted to the Mittelstand.
The increasing number of Mittelstand smart deals may well not compensate
for the missing big deals. Yet the optimism of the venture capital firms
focused on Mittelstand companies is justified', concludes Kraus from the
result of the study. 'The fact that 90% of the venture capital firms plan
new investments and two thirds plan exits for this year indicates the
sustainable success of private equity in Germany', emphasises Stübiger.
'The industry, however, is now in line for a consolidation phase. The
intense competition has put pressure on expected returns. The optimistic
investment targets of the industry can only be realised by sustained
economic growth in Germany.'
For the study Rödl&Partner carried out a survey at the beginning of 2012
of over 300 venture capital firms in Germany. The response rate was 35%.
Participants in the survey were international companies and venture capital
firms from the private and public sector.
Graphics / charts
On request we will be happy to provide you with high definition graphics on
the results of the study. In this case please contact our press office.
Printed version of the study
A printed version of the study is available from Rödl&Partner in Munich.
Please contact: Regina Völker, Tel.: +49 899287 80525, Email:
regina.voelker(at)roedl.com.
Your contact partners:
Wolfgang Kraus, Certified Public Accountant, Certified Tax Consultant,
Managing Partner
Tel.: +49 91191 933333, Email: wolfgang.kraus(at)roedl.de
Björn Stübiger, Partner, Head of Corporate Finance
Tel.: +49 899287 80515, Email: bjoern.stuebiger(at)roedl.com
Press contact:
Matthias Struwe
Tel.: +49 (9 11) 91 93-28 45
E-Mail: matthias.struwe(at)roedl.de
You may download photographs of the contact partners from the Rödl&Partner Press Centre at www.roedl.de/pressecenter.
Further graphics are available at www.roedl.de/PE-Studie-2012.
Rödl&Partner - entrepreneurs advise entrepreneurs
Rödl&Partner has its own offices at 87 locations in 39 countries. The
integrated professional services firm for law, tax, consulting, auditing
and accounting owes its dynamic success to more than three thousand
entrepreneurial-thinking professionals. In close co-operation with their
clients, they develop information from the fields of business, tax, law and
IT enabling a sounder basis for increasingly cross-border decisions and
provide support for these during their implementation.
The corporate finance division of Rödl&Partner advises companies on
raising capital via the capital market, strategic partnerships, M&A
transactions and the strengthening of equity via private equity and venture
capital. The lawyers, tax consultants, accountants and corporate finance
experts of Rödl&Partner have extensive experience in the field of
financing strategies, IPO consulting, capital increases, with legal, tax
and financial due diligence audits and with company acquisitions and
disposals in Germany and other countries.
To find out more about Rödl&Partner, visit www.roedl.com.
End of financial news
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