Fronnt group acquires Electro Verbeke in Deinze, Van Vooren/Setec in
Bruges and Tac! in Wilrijk. Fronnt is a cluster of
installation companies with the investment company Gimv as the
majority shareholder. It makes the energy transition for companies
easier.
"Take a horticultural company," explains CEO Geert Fostier. “If it
wants to switch from fuel oil for its heating to a
heat pump, the manager is told that a heavy-duty power supply of
50 amps is needed. That means he has to call in his electrician,
who then tells him that the grid needs to be made stronger with a new
electricity cabin. Perhaps the company director would also like to have solar panels
on his shed and he wants to give some of his staff an electric company car,
for which charging points are needed."
In that case, the director often has to solicit companies that
specialise in just one technology. Fronnt combines these different
technologies in its offering. "Among our customers, the combination of
heat pump, charging stations and solar panels is very popular - it means
their heating and mobility becomes electric, plus they generate
renewable energy," enthuses Fostier.
Accelerating the energy transition is a cornerstone of the Green Deal, the
European Union's growth strategy that aims to link economic prosperity
with being climate neutral by 2050. This is essential to halt
global warming and its adverse impacts on our
societies. No matter how much you support this transition, you are only
a company director who sees this upheaval looming on the horizon. With the
rising energy costs in mind, you want to make your buildings and
production chain more energy efficient. You need to exchange fossil energy
for heat pumps and have your outbuildings full of solar panels. The government
wants all company cars to become electric, and for that you need
to have charging points.
Taking away the hassle
Taking away the hassle for SMEs in the middle segment (Fronnt does not target private individuals)
with offers that integrate these various technologies
is a gap in the market that the investment company
Gimv also saw. "The time is right to fill that gap," explains Ruben
Monballieu, partner at Gimv Sustainable Cities, one of the
investment company's 5 investment platforms. “The
energy transition is based on the integration of all these technologies. What used to
take place separately is now being combined.” It's a good example of how, by
moving away from compartmentalised approaches – one company for each technology – towards
an integrated systems approach, you can accelerate
societal change.
If you want to offer a full range of technologies to help companies
with their energy transition, you obviously need to have those technologies in
your portfolio. That's what Fronnt is 100% focused on. The wave of acquisitions started
with Lenaerts/LVR and ABN Klimatisatie in the first half of 2022. That was followed
later in the year by Climawest and Sanitel. Now there are a further three takeovers:
Electro Verbeke, Van Vooren/Setec and TAC! The first two are
specialised in electrical works, data systems and automation,
when TAC! is active in air conditioning, heating, ventilation and plumbing. Fronnt
does not yet have all the technology in house that it wants to; more targeted acquisitions
are in the pipeline.
Together with Tilleghem
With the three acquisitions, Fronnt has leapt from a turnover of 30 million euros
to 80 million euros, and from 100 to 250 employees. There won't be any
exhaustive integration. The company primarily sees itself as a small,
efficient holding company watching over a network of entrepreneurs. “We respect
the autonomy of the companies we acquire as much as possible," explains Geert
Fostier. "Each company retains its office, its name - although there is co-branding
with Fronnt - and the management commits to staying on board",
Fostier continues. "We capitalise on scale effects and
support entrepreneurs by helping them with the Gordian knots
they face in finance, human resources or procurement. We help them grow and
find good people.”
Gimv does not disclose any acquisition figures. One interesting aspect is that the
acquisitions of Van Vooren/Setec and TAC! came about thanks to a
collaboration with the investment company Tilleghem. Gimv and
Tilleghem realised that they were working on the same project - consolidation
among installation companies which was necessary for the energy transition of businesses - and
decided to work together. The two companies were already in the portfolio of
Tilleghem. Fronnt acquired them, which meant that Tilleghem came on board
as a shareholder at Fronnt. "We were working on the same thing, and we also had
the same philosophy”, recalls Ruben Monballieu of Gimv. “We see it
more as a collaboration of entrepreneurs rather than a big
industrial group. It was a logical conclusion to join
forces.”
Not yet in Wallonia
The consolidation in Belgium comes on the heels of similar consolidations in the Netherlands and Germany,
Monballieu points out: “In Belgium, there is still a highly fragmented
landscape of small-scale installers who only specialise in one technology. We believe
that there is a lot of opportunity in this middle segment. In any case, we are seeing demand
for multi-technology solutions rise. The entrepreneurs behind these
installation companies are looking for partnerships so their businesses can
grow faster.” Geert Fostier adds: "We focus on projects from between 10,000
to a few million euros - not on the big industrial companies in the
Port of Antwerp. We are active in industry, the public sector and
real estate. As regards industry, these are rock-solid Flemish SMEs
in the manufacturing industry. In the public sector, it may be, for example, a
city building a new cultural centre. We then take care of the
lighting, camera surveillance, access control, heating and charging stations.
In real estate, a typical customer is a building developer
building an apartment block, in which we do all the technical installations."
Monballieu and Fostier admit that there is competition, but in other
segments than the middle segment targeted by Fronnt. They also plan to
expand geographically. “We have Flanders pretty well covered, but we
don't have a presence in Wallonia yet''.