Opex Awards 2016: EMEA, upper mid-market – EQT Partners

Revenue almost doubled in the five years following EQT’s acquisition of the Swedish medical device manufacturer from Nordic Capital in 2011.

Atos is the global leader in voice restoring devices for patients that have had a laryngectomy to remove their voice boxes following surgery. Atos is seven times larger than its nearest competitor in the laryngectomy market and the only global player – a position bolstered by EQT’s relentless focus on expansion. Since 2011, its global sales force has expanded by 70 percent and it has established a direct sales force across 11 new countries, including Japan, Brazil and Italy. The Malmo-based company now has the largest dedicated ear, nose and throat sales force in the world.

“The partnership between Atos Medical and its owners EQT Capital has been a very fruitful one,” said judge Antoon Schneider. “The company almost doubled in size over the five years ownership by EQT, and its EBITDA margin rose impressively from 28 percent to 40 percent.”

This success in creating genuine value was noted by another of the judges Miles Graham. “What stood out for me with Atos is the clear value-creation bridge. This was a very successful investment for EQT, but as their value bridge testifies, it really was entirely based on the operational delivery of the business, not due to returns boosted by QE-induced multiple expansion or cheap debt,” he said.

The growth strategy encompassed a raft of operational changes, including a new direct sales model involving an innovative direct-to-consumer model. This gave Atos direct access to the end-customers to manage their ordering and re-imbursement process and to help best practice.

Product launches included a new hands-free speaking valve and a new innovative coming home kit, which helped Atos Medical win a prestigious Red Dot Award for excellence in design and innovation.

EQT also brought in new senior staff as part of a generational shift, including a new chief executive and chief financial officer.

Production efficiencies and a reduction in back-office operations helped boost the EBITDA margin.

EQT is delighted its efforts have paid off. Åsa Riisberg, partner and head of healthcare at EQT Partners, said: “Atos Medical has developed into a true global market leader, which we are immensely proud of. With a focused growth strategy, Atos Medical has continued to penetrate the white space in the laryngectomy care market, improving the quality of life of its patients.”

Atos Medical was sold to private equity firm PAI Europe in May 2016, yielding “impressive” double-digit returns, according to Schneider.

“These results are a combination of various strategic and operational measures in which EQT played an active role, ranging from investing into a global sales force and new products to driving operational efficiency gains to managing a generational shift in the management team,” he said.