This acquisition comes as no surprise and fits not only with the Permobil value added product line but establishes a larger footprint in the French market - a market so far largely shunned by other large Nordic players like Etac and Handicare. This represents another investment for Nordic Capital, relatively new owner of Permobil.

It also continues the buying spree of the “Homecare Vikings” which we wrote about two years ago and at the beginning of this year when Handicare had just completed two acquisitions within months of each other.

There is no question that “stand up” chairs, both manual and powered, offer higher margins to manufacturers. It is also true that this market segment is maturing with the mainstream large manufacturers having entered the market in the past year or two - better late than never.

Could we be heading back to those heady days in the mid 90’s when now market leaders Invacare and Sunrise went on big buying acquisition drives, or are the Scandinavian homecare vikings being more selective?

Here is what Hans Bergh, CEO at Permobil says:

As part of its international development strategy in the field of specialist medical equipment for the handicapped community, PERMOBIL has just carried out the acquisition of the French company LIFESTAND, situated in Lyon.
LIFESTAND, which was founded in 1978, specialises in the design and manufacture of « stand-up » wheelchairs. These wheelchairs, which can be operated manually, semi-electrically or fully electrically, enable a disable person to stand upright.
The company, which has a staff of 30 people, markets its products worldwide, with 80 % of sales into export markets. It has a subsidiary in both Germany and Belgium.

Annual sales exceeds 8M Euros, with good profitability.
This transaction strengthens PERMOBIL’s position in a key, potentially high growth, market in which it is already present with its powered wheelchairs !

“This acquisition gives a great opportunity to develop even further our position in this field thanks to LIFESTAND’s full gamut of top of the range « stand-up » wheelchairs, which cover all pathologies”, says PERMOBILS CEO Hans Bergh

For LIFESTAND, this merger with such a well-established group will enable it to widen its distribution network, particularly in the United States.

For more information :
www.permobil.com
www.lifestand.eu

It will be interesting to see the integration strategy of this Swedish and French company.

Per-Gunnar Borhaug, CEO Handicare AS and Hardy Brännström President Romedic AB announce the acquisition of Romedic by Handicare.

Handicare AS acquires RoMedic AB in Sweden and strengthens its position internationally within lifting-, transfer- and positioning products for elderly and handicapped.

Handicare’s revenues are estimated at over 225 million Euros ($320 million) putting it in our top 3 European homecare companies (similar category).

Handicare which is owned by the Ferd Private Equity Fund has been selectively acquiring higher value product companies in the Homecare space, including Freelift and Movingpeople in the Netherlands.

We originally wrote about Nordic companies on the acquisition trail end 2005 “The Return Of The Homecare Vikings”.

Seems like they have done pretty well from my vantage point.

As a brief follow - up to the post on this subject this week, we can now confirm that Invacare, Meyra and Handicare will not be attending this years Rehacare.

This is the first time in the history of this show that Invacare and Meyra have not attended.

No doubt the empty space will be used by others - most notably Asia manufacturers.

The reshaping of the industry continues…

Reha has now come and gone again and I have decided to choose a winner.

Handicare is the winner, and this is the reason.

Less than a year after acquiring

Movingpeople , Handicare has done a great job of presenting one face to their European customer. Their booth was simple and clearly branded. In addition and probably most important was that their employees represented their newly merged company with passion.

Besides the people, Scandinavian and Dutch companies have a strong commitment to closely match product with “real” customer needs and add value.  Handicare is no exception. Customer (consumer, dealer, reimbursement agency etc) needs first - the China gold rush second - if you get what I mean.

I first wrote about this in November last year.

Here is also a related editorial

The Return Of The Homecare Vikings

Oh, I also wanted to mention Otto Bock who did a noteworthy job of presenting mobility and lifestyle enhancing products.

With all the reimbursement issues going on notably in the US right now, you cannot help wonder if these issues would have been at least partially mitigated if the manufacturers had focused (like Otto Bock) more on what these products really mean to consumers as opposed to the usual manufacturer/ dealer rhetoric.

What do Industri Kapital, Nordic Capital and Ferd have in common?

In a homecare / rehabilitation / mobility marketplace where the aging population demographic is no longer a sure fire way to print money, companies are restructuring like crazy, products are being outsourced to Asia, companies are setting up their own operations in Asia, share holders in publicly traded companies are on the whole watching stock prices fall. Products are being standardized and de-featured…. and yet

These three Scandinavian based organizations have all fairly recently invested serious money in the “home healthcare” industry. The obvious question is why - and while I am not privy to all the reasons I would speculate as follows.

Industri Kapital is the owner of Welzorg in the Netherlands - the largest supplier of home medical equipment in the Netherlands - by far. Reimbursement for HME products there, continue to be among the highest in Europe.

Ferd is the finance group behind Handicare in Norway who recently made acquisitions in Denmark and the Netherlands (Movingpeople). They sell high value added products.

Nordic Capital is the group behind Permobil. Permobil manufactures high end Power chairs and is thriving in today’s tough reimbursement environment.

It seems to me that these three groups are betting on the higher value end of the business with good products and customer relationships, where they directly solve individual needs in the disabled and geriatric community. Of course they will have to continue to reduce the cost of their products - but then again doesn’t everybody?

There are several other companies in this industry for sale today, and have been for some time - but not many in this high value category.

Handicare (Norway) acquires Movingpeople (the Netherlands)

Here is a quote from the Handicare press release:

�This acquisition benefits both companies, and also our respective customers,� says Per Gunnar Borhaug, CEO of Handicare. �Movingpeople.net is a healthy company which will add great value to the group�s business activities. This extension is consistent with Handicare�s strategy of further strengthening our international position through organic growth and acquisitions.�

The full release is here

Heres what I think:

This looks like a pretty exciting acquisition and follows Handicare’s other recent acquisition in Denmark.

This creates one of the largest healthcare companies in this category in Europe (140 million Euro). The product ranges of both companies are predominantly in higher value added products (without many overlaps) . This also positions Handicare to participate in the more lucrative ( read higher reimbursement or privately funded) European countries. Of course the increased revenues will benefit both companies when negotiating new supply agreements especially in the powered product areas. In addition Movingpeople has a great young management team.

As with most acquisitions of this type executing the cross selling activities and product rationalization / alignment quickly and effectively will be key.

If the longer term strategy were to expand further into Europe there are companies that are emerging in the more southern countries that may well be future acquisition / merger partners.