EQUISTONE NEWS | October 2020

During our conversations with entrepreneurs and managers, we noticed that today more than ever and for good reason, there is an even greater focus on security and trust. Facturing in possible challenges into investment plans from the beginning and therefore building a stable foundation for your portfolio companies, exhibits an increased level of reliability. And those who are able to offer their management teams a maximum of support and close cooperation in unexpectedly challenging situations can expect an even greater level of trust from both entrepreneurs and investors.

Even during times of social and physical distancing, we have worked closely with our portfolio companies, facilitated exchange both via telephone and “virtual” means, and hopefully charted the right course together for each individual portfolio company.

Two examples of that from our portfolio, we would like to present to you in this newsletter: RENA Technologies, a specialist for wet-chemical surface treatment, is continuing its expansion course with an add-on in Austria; and Omnicare, a pharmaceutical wholesaler of finished medicinal products for cancer medications, is also expanding its already excellent market position further (more on that in our Case Study).

We would also like to inform you about new developments in our Munich-based team and about the launch of the online version of our “Equistone Platform” magazine.

RENA Technologies set for global growth trajectory

In times of Covid-19, keeping the company on course while not losing sight of the long-term perspective, has been one of the major challenges for management teams. Our portfolio company RENA Technologies managed to succeed in doing so: With above-average growth, the technology expert based in Germany’s Black Forest region has weathered the Covid-19 situation successfully and has also set its course for future expansion.

Equistone invested in the RENA Group, a globally leading producer of wet-chemical surface treatment equipment based in Gütenbach, Germany, in early 2019. The group’s high-quality products are used in future-oriented fields of application such as semiconductors and wafering, renewable energies, special glass, batteries and energy storage as well as MedTech. With the acquisition of the Austrian company Hirtenberger Engineered Surfaces (HES), RENA is now taking the next step as part of its dynamic growth strategy. HES, based in Hirtenberg near Vienna, focuses on pulsed electrochemical surface technology and – with its approximately 30 employees – operates as a specialist in the post-treatment of metal parts produced using 3D printing. With the new, high-growth market segment of Additive Manufacturing (AM), HES will ideally supplement RENA’s service portfolio. Central to this strategy is the integration of HES process know-how as well as its signature technology “Hirtisieren” into the global company structure to build the core of the new RENA technology.

In addition to expanding its service portfolio, RENA also continues its geographical expansion: By establishing RENA Technologies Austria (RENA AT) as part of the acquisition of HES, as well as renaming its 2019 acquisition MEI Wet Process Systems & Services LLC into RENA Technologies North America (RENA NA), the group has strengthened its access to important European and North American markets. In the future, RENA AT will be central to the group’s activities in the market segment of Additive Manufacturing and will also serve as a research and development centre for all technologies focused on electrochemical surface post-treatment. The integration of RENA NA is in accordance with the group’s global product and service portfolio diversification strategy, while strengthening the presence of RENA’s entire product range in the US market.

“In recent years, RENA has experienced an impressive development, and not only in regard to its financial growth – the company has also taken large steps in terms of diversification. With the expansion of its new locations in Europe and North America, we will continue to accelerate the group’s growth trajectory once more in cooperation with the management team”, says David Zahnd, Investment Director at Equistone.

Case Study: Omnicare – An ideal network to ensure the best possible care for cancer patients

Providing the best possible support and care for cancer patients is one of the most demanding and responsible tasks in the health sector. In particular, the possibility of providing therapy on an outpatient basis in local oncological clinics contributes significantly to patient satisfaction and therefore therapy success. This type of outpatient therapy requires that the supply of the clinics with the necessary oncological medications is ensured. These are produced by pharmacies specialised in this field on a patient-specific basis.

In Germany, this supply of cytostatic drugs is provided by Omnicare, a company headquartered in Unterföhring near Munich, with additional locations in Cologne and Calw. With more than 190 employees, Omnicare is active throughout Germany as a leading pharmaceutical wholesaler specialised in finished medicinal products for the patient-specific production of cancer drugs. Since the majority investment by Equistone in October 2019, Omnicare has further improved its outstanding position on the German market and initiated a range of measures to support its organic growth.

Founded in 2002, Omnicare has developed into a central player on the German market for the distribution of cytostatic drugs: Due to its excellent positioning and marketing expertise, the company has access to a large network of supply relationships with a majority of pharmacies in Germany and is also one of the most important wholesale partners for leading pharmaceutical producers. Going forward, the company’s internal processes are to be improved even further along with its level of professionalisation, for example through the hiring of a Chief Compliance Officer (CCO).

In addition to delivering cytostatic drugs, Omnicare offers a range of services for highly specialised pharmacies and medical clinics to support them in areas such as quality assurance, monitoring cleanroom hygiene as well as during the training and development of specialist staff – all with the goal of improving the close-to-home, outpatient care of cancer patients.

To support this goal, Omnicare has in 2019 expanded its service portfolio and subsequently created the “Omnicare Quality Initiative” on the basis of both extensive experience and direct practical insights. At the moment, 40 specialised pharmacies are already participating in the initiative with the aim of further improving the already high quality standards for the production of patient-specific cancer medication. In this way, a maximum of quality and hygiene is ensured. For that, the participating pharmacies regularly send laboratory samples to a central monitoring database, which is provided and maintained by Omnicare. The samples are then analysed and detailed hygiene reports are sent back to the pharmacies. Furthermore, as part of the initiative, inspections of the pharmacies’ laboratories are conducted by specially trained Omnicare employees every two years in addition to the official quality inspections and for the most parts with standards that even exceed the legal requirements. The quality initiative is to be further expanded in the near future, for example by winning new partner pharmacies and improving both services and supporting measures even further.

In addition, Omnicare has established the “German Oncological Network”, an association of leading oncology clinics in Germany with the declared aim of strengthening and further advancing their structural development in accordance with the interests of patients. Since the founding of the network in 2018, Omnicare has expanded it continuously – Equistone will support this process now, for example by positioning the network more prominently as a brand on the German market as well as through acquisitions on the basis of minority investments in related fields such as medical care centres.

Oliver Tamimi, Managing Director of Omnicare, comments on the recent developments: “We were able to implement a range of measures, which allowed us to improve our market position even further. Over the previous year, we were able to significantly exceed our annual budget, despite facing challenges on the supplier side as a result of the Covid-19 crisis. We intend to maintain this momentum in the future in order to continuously improve the supply and care of cancer patients with oncological medication.”

Julia Lucà, Investment Director at Equistone, adds: “Omnicare’s excellent network and positioning in the market as well as the extensive expertise of its employees and management team, which form the basis of its broad product and service portfolio, have convinced us from the very beginning. Over the previous year, together with the management team, we have set the company on a growth course and aim to support it in further improving its market position as well as further expanding the ‘Omnicare Quality Initiative’ and the ‘German Oncological Network’.”

As of June 2020, Julia Lucà (née Brunswicker) has been promoted to Investment Director of Equistone Germany. Since March 2019, she has been supporting our transactions in the DACH and Netherlands region along with our team from the Munich office. Before joining Equistone, Julia was a Senior Investment Manager at Deutsche Beteiligungs AG.

“Strong partnerships with our portfolio companies are what we focus on at Equistone. And especially during challenging times, these partnerships are becoming even more important. I am looking forward to further expanding the relationships with our portfolio companies as part of my new responsibilities”, says Julia Lucà.

As of August 2020, Christoph Wüstemeyer is a new Investment Manager for the Munich-based team of Equistone Germany. Before joining Equistone, he obtained an MBA from Harvard University and has been gaining industry experience in different positions – for example with The Carlyle Group’s investment practice, with a mid-sized fund focused on medical and industrial technology, and with Bain & Company as a consultant.

Christoph Wüstemeyer says: “I am looking forward to being a part of Equistone Germany and supporting our portfolio companies with the realisation of their projects and growth targets along with my new colleagues.”

Even more background information and news from the world of Equistone

PLATFORM is Equistone’s global magazine, which regularly informs our friends and partners with background information about the markets and our portfolio companies as well as internal news from Equistone. Until recently, the English-language magazine was only published in print, but with the new “Platform+” version, selected print content is now also available online, supplemented by exclusive web content. In this first issue for example, you can find a video interview with our Senior Partner and Chief Investment Officer Oskar Schilcher, who illustrates how Equistone is mastering the challenges of the current crisis in cooperation with its partners.