Q&A

Below you will find answers to questions that we are often asked during the investment process. If you have any further questions, please do not hesitate to contact us.
What is due diligence and how does it work at Blue Cap?

Due diligence involves carrying out a detailed analysis of a company at various levels. Buyers complete this process before acquiring a company. We carry out due diligence with our own experienced employees and the assistance of external consultants. Depending on the company, the due diligence process can have different areas of focus. Typical points of review are the market, customer and competitive situation, the company’s finances and tax & legal due diligence.

How does Blue Cap assess a company?

Blue Cap uses all standard methods to assess companies, such as relative valuation, DCF and LBO models. The assessment is generally based on observable valuation factors of comparable companies, taking into account various factors such as company size, market position, profitability, growth prospects, cash flow, current trading, business plan and implicit risks (trading multiples).

How does Blue Cap finance the purchase of a company?

As a listed company, Blue Cap has a solid equity base and can usually finance acquisitions from existing liquid assets. We also regularly review the admixture of debt capital if this is deemed sensible for economic and tax reasons. With our stock exchange listing, there is also the possibility of raising additional capital through capital increases.

Is Blue Cap a private equity firm?

Like many private equity firms, Blue Cap is also a temporary owner. However, due to our structure, we are not subject to (fixed) fund maturities. Every one of our portfolio companies is given the time it needs to reach a sustainable course of growth. We keep our portfolio companies in the Group until it makes more sense for them to pursue successful performance with a new ownership structure (best-owner approach).

What role do synergies play in the takeover process?

Synergies are not part of our acquisition criteria for independent acquisitions in new fields. An exception to this rule are acquisitions for existing portfolio companies. In these cases, synergies are part of the economic potential to be analysed.

When is an acquisition not possible from Blue Cap’s point of view?

Blue Cap AG invests in established SMEs that have clear potential for improving their earnings and growth prospects. We do not consider ourselves to be the right partner for start-ups or very young companies, or for companies that do not have potential for improvement or that have very high restructuring needs.

Why is Blue Cap the right partner for succession bottlenecks?

An entrepreneur dealing with a company transfer usually wants to ensure that the company can continue on a positive trajectory with its employees and can seize new opportunities with Blue Cap. This is why we offer the transferring owners a transparent platform on which their company can continue to develop independently without having to relinquish the strengths of a family business or, worse still, lose its identity. Carving organisations up or focusing exclusively on cost management to save until there is nothing left to save is not Blue Cap’s approach.

Does Blue Cap also participate as a minority shareholder?

As a general rule, we aim for a majority shareholding alone or with a partner, as this is the only way we can actively support and assist our portfolio companies.

Does Blue Cap also acquire companies in economic difficulties?

Blue Cap has in the past acquired companies in economically precarious situations. The main requirement, however, is a healthy core business and sustainable potential for value growth.

What happens with a company following an acquisition?

Our aim is for every portfolio company within the organisation to operate independently and develop and follow its own individual strategies. As part of the integration process, new portfolio companies are incorporated into Blue Cap’s reporting and risk management processes. The experienced Blue Cap portfolio team is also available to the portfolio companies as a strategic sparring partner and can supply the companies with additional resources for strategic projects. Blue Cap and the portfolio companies regularly discuss important issues, and a conference is put on every year where all managing directors can come together to share experiences and learn from one another.

Can the seller remain associated with the company as part of the succession plan once the takeover by Blue Cap is complete?

The seller usually brings a great deal of market and company expertise with them and can benefit the company’s continued operations. The concrete structure of the collaboration is agreed individually on a case-by-case basis. A minority shareholding or working with the company as an external consultant, for example, is plausible.

Does the management team stay the same following the takeover by Blue Cap?

Usually a key investment criterion is the continuation of the company’s operations by the existing management. We are interested in a collaborative partnership and, as a rule, our approach is to keep the management team involved in the company even after the takeover. Retaining the existing management team can provide continuity in the company’s development. The concrete structure of the investment is agreed on an individual basis.

Hello, my name is Tobias Eiblmeier

Mergers & Acquisitions


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