Successful French Takeovers: Interview with Harold Brummelhuis

Harold Brummelhuis, Principal at JBR Corporate Finance, shares his experiences and insights on successful French acquisitions and the crucial role of personal relationships and cultural understanding in M&A processes.

In one year, Harold Brummelhuis, acquired three purchase mandates from three very different French companies. The first mandate was obtained after intervention by French colleagues within the globally operating REACH Group to which JBR is also affiliated. The company in question, Osmaïa Group, operates in the field of landscaping and is looking for platform businesses and expansions in Belgium, Germany, Switzerland and the Netherlands. The company is owned by Private Equity. Among other things, it is important to the company that such a party mainly operates on the basis of multi-year public and private contracts and that the management stays on. In addition, they are looking for candidates with revenues between EUR 5 and 50 million and EBITDA between EUR 2 and 5 million that have a strong and local brand name.

How did you successfully handle the acquisition mandate for Osmaïa Group?

"We presented the profile of the Osmaïa Group in a concise presentation that served as a 'teaser.' In it, we also clearly stated the requirements that acquisition candidates had to meet. After extensive market research, we selected 35 companies that could serve as platforms. From that list, we personally met with the management of over 60% of the companies. This led to four face-to-face meetings between the CEO of the Osmaïa Group and the management of those parties to explore possible cooperation. All of these conversations were very carefully prepared. During those talks, the CEO immediately made it clear that after a possible takeover, for example, the company name would not change and that it was important to him that the incumbent management would stay on. Eventually it was decided to actually enter into talks with T&G Group. Only at that point was the 'non-disclosure' agreement signed."

What were the biggest challenges in dealing with language and cultural differences in acquisitions?

"Dealing with those differences was possibly the most important part of the process in the transaction. At the initial introduction, we organized a closing dinner with both CEOs, Osmaïa Group's internal M&A advisor and T&G Group's advisor. Another important participant in the dinner was a Belgian interpreter who had an excellent command of both French and Dutch and who had experience in acquisition projects.
Naturally, there was a lot of talk about both companies and it turned out that both CEOs had a good click in terms of professionalism and also personally. However, they also reacted strongly to each other's body language and at certain moments the exact translation of certain words and concepts was crucial. This was the case, for example, when the CEO of T&G Group explained that the results in the spring were disappointing because of the bad weather and certain work had already been done but no final invoice could be sent. Another good example was the explanation of the term 'ZZP-er'. At the mention of the number of ZZP-ers used, the French CEO was shocked, but that concern was dispelled by a good explanation which made it clear that these are temporary workers who serve as a flexible shell.

"Dealing with language and cultural differences has possibly been the most important part of the process."

They eventually agreed on the price and terms, and JBR is still in talks with several companies for possible further acquisitions. We are now in the final stages with two other parties, and in the meantime new companies are being approached to make at least two more acquisitions in 2025 as well."

How did CEOs experience the acquisition processes and what helped?

"Both indicated that the use of an interpreter was very important to them and contributed greatly to a better understanding of each other's points of view and how to conduct business. Finally, our very personal approach was particularly appreciated. We spent a lot of attention and time on that but that allowed the process to go through fairly smoothly."

What was the success story behind the second French procurement mandate for Groupe LT?

"We were approached by Groupe LT whose activities include road markings, traffic measures and signage. The company also turned out to be part of the same Private Equity party as the Osmaïa Group whose CEO had recommended JBR to them as an M&A advisor because of the good experience and personal approach. That was a great compliment to our team!"

Did you use the same approach for the French acquisitions or did you make specific adjustments?

"No, we haven't actually changed anything. Groupe LT also had clear wishes regarding the profile of the acquisition candidates. They too were looking for a platform company as a start for further expansion in the Netherlands.
Then it turned out that Van Rens, a division of Strukton, was for sale and we approached them. It then turned out that they were open to meeting and we organized a meeting at our office with both CEOs. Again, our interpreter was present to avoid speech confusion. This was certainly helpful in explaining the current situation at the parent company Strukton. To conclude, we offered a dinner with a "private chef" at our office where the CEOs sat side by side to intensify their relationship.
From the beginning, Groupe LT made it clear that the starting point was that there would be no layoffs, the company would continue independently and retain broad decision-making powers. The unbundling of the parent company Strukton will be realized in the coming months and, in the meantime, preparations have also started to make further acquisitions in the second half of 2025 that will broaden the company in terms of activities and area of operations."

Did the third French company also come to JBR based on recommendation?

"No, we were approached directly, i.e. without third-party intervention, by TSG who used to be mainly active in the field of installation and maintenance mainly at gas stations and are now developing rapidly as a supplier of new energy for mobility and technical services for sustainable mobility hubs. The company has a turnover of EUR 1.1 bln and is already present in the Netherlands with more than 250 employees. Again, we took the approach described earlier. No interpreter because the director at TSG Netherlands is Dutch, but a personal approach and a dinner or lunch to optimize relations.
We had prepared a clear presentation that made it clear to potential acquiring companies what TSG is looking for and how they operate. We carefully drew up a short list and approached one of the parties to make an appointment. The first meeting was an immediate success. The explanation about the possible cooperation also hit the right note with the sellers and we are now in the process of working out the details of this transaction. We expect to finalize and announce it in early 2025."

What were the key factors in the success of three French acquisitions?

"When I think back, it actually sounds very logical now. It was important to prepare well and immediately establish a good relationship with the French CEO as well as to pay close attention to French culture. It also helped that before there was any prospect of an assignment at Groupe LT, I did go to Paris by train with the interpreter to get more information about the company and, of course, to have lunch. In France, I understood from the CEO there that he went for a business lunch every day. Next, I think making sure there was intensive direct contact between the CEOs helped a lot. Finally, using an interpreter was crucial to convey information clearly and avoid misunderstandings. Finally, also organizing a good lunch or dinner regularly."

Source: Consultancy.co.uk

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