in this section


Uwe Alwardt

case studies


Uwe Alwardt works with our Western European deal team. As an operating partner he takes on a more strategic role and functions in a non-executive capacity. He has been instrumental in two complex turnarounds: Moeller and RWE Solutions.“The attraction of working with Advent is the chance to develop a strategy, work out a restructuring and realise the potential of any company we acquire.”Uwe Alwardt

Summary

Uwe Alwardt fits the model of an Advent operating partner perfectly: with international experience in running and turning around large electrical businesses, he has the background, the skills and the attitude to make a real contribution to the Advent model.

Uwe has more than 20 years’ operational and managerial experience in the electronics, automation, manufacturing and electrical industries. He was chairman of the Moeller Group during our ownership from December 2003 until exit in September 2005.

And when RWE decided to sell the RWE Solutions Group, a business which was turning over €1.5 billion with more than 8,000 people and more than 20 different businesses, Uwe was one of the team of operating partners tasked with uncovering value for Advent.

How would you describe your business background?

I’ve worked in several companies in a number of roles including serving on the board – for example, at Hartmann & Braun, a leader in process automation; Elsag Bailey, which was listed on the New York Stock Exchange; and I was president of ABB Automation Products in Germany. Then in 2001, I started to build my own business.

How did you first become involved with Advent?

Advent was looking for an operating partner in the electrical sector, so they contacted the institute where I served on the board. It was something completely different to what I’d done up to then. Advent in Germany was interested in looking quite broadly into the sector. With my long experience and network within the industry, we were able to team up and screen a number of different companies.

What has been/is your role as an Advent operating partner?

Initially it was all about building contacts and seeing where the opportunities for Advent might lie. Moeller was actually a good example of that: I knew the company well, I knew the owner and I was familiar with the management team – but it was a very broad approach initially.
I’ve been involved in two bigger deals with Advent, encompassing the whole deal cycle from sourcing, the due diligence phase, investment, chairing the companies and then preparation for exit.

I’ve also had a huge number of additional relationships with Advent looking into companies that match my industry focus and background – including due diligence, management presentations, discussing the potential for deals and so on. Basically, it’s anything that helps Advent make an investment decision – and then afterwards, to help make sure the plan for value creation runs smoothly.

With which Advent investments have you been/are you involved? In what role(s)?

At Moeller, the task was extremely complex. The company was in very bad shape: profitability had declined sharply, it had real cashflow problems and had had to agree a standstill agreement with all of its banks in Germany. The markets were declining and the strategic positioning of the company was leading it in the wrong direction. So there were three major actions. First, stop the loss-making businesses immediately. Second, generate cash as soon as possible. And third, stabilise and push the core business, the future of the group.

All of that meant it was necessary to move directly into the head office and assume two roles. One was as chairman of the supervisory board – but in parallel with an executive managing director position.

At RWE Solutions, it was a chairman role, but with so many businesses that meant working with a number of management teams. My part in the deal was to develop SAG – which encompassed about two-thirds of the businesses, the non-nuclear ones – and to execute a strategic restructuring as soon as possible together with the management teams.  In RWE Solutions, there were about 20 different business units managing services, products and projects, mostly for utilities clients but also for the industry.  Because there was no reason to keep these businesses together and because it was not core for utilities, RWE decided to sell them in a big package deal – together they represented about €1.7bn in turnover.

What have you enjoyed most as an Advent operating partner?

The attraction of working with Advent is the chance to develop a strategy, work out a restructuring and realise the potential of any company we acquire. So turning around Moeller was a great experience. After nine to twelve months, we had a completely restructured company. The systems business was repositioned, meaning the loss-making parts were sold or closed. The industry and building automation component business was growing very strongly and was very profitable.

What has been your greatest challenge?

The biggest challenge is typically the time around closing the deal and directly after closing.  During this time you have full access to the management and your first deep insight into the company.  Every day can throw up surprises and new situations that you never expected and it is the time when you have your first experience of working with the management.  Everybody is nervous and you have to take your first tough decisions such as closing down facilities and reducing headcount.

What advice would you offer someone thinking about becoming an Advent operating partner?

The role of operating partner provides an excellent opportunity to bring to bear all your experience in creating value for an Advent portfolio company.  On the one hand you have to work very closely with the business – to be intimate with the management and markets – and on the other hand you can get involved in strategic restructuring and repositioning.  Sometimes, in turnaround situations, having authority is also crucial.

The operating partners are very important because the potential for restructuring, the possibilities for profitability in the future, are very closely linked to the expertise you can bring. And on the other side, it is very important to understand the relationship with management. As an operating partner with sector expertise, you can talk with the managers about the business, the products and maybe some of the less unique issues – and they like this.

The first question you ask as an operating partner is, “what is the management team like?” As operating partner, you are the interface between Advent and the management team, so from the very beginning you have to have an accurate assessment of the team – and you have to tell very quickly whether you can work with them, or whether there need to be changes.
The next step – although it must be as early as possible – is to come up with your 100-day plan and know how you’re going to work through it together.

What does it take to be an effective Advent operating partner?

I would say an operating partner should be interested in handling difficult circumstances. That doesn’t mean Advent only invests in tricky situations – but the reality of running an investment business is that the best opportunities are often those where there are complex problems to solve.

The biggest difference between being an operating partner and having a job in a corporate is that you are an entrepreneur, making the call on strategy and operations. You are free to push in different directions and initiate quick decisions in a way that’s rare in the corporate world. And as an operating partner, you have that unique relationship with both Advent and the company – so you can drive those decisions that you know will benefit the business without referring it elsewhere or waiting for a green light. That’s enormously efficient compared to working in the big corporates.

Why do you choose to work with Advent?

The Advent focus on specific industries with a certain amount of industry know-how is really important. It’s just not possible to take a company like Moeller, a restructuring case, and to develop and to create value if you only take a financial view. This is, I think, important and unique in Advent. Advent understands not only financial aspects, but also the country, the industry, the market and the business.

contacts


Conor Boden

Head of Portfolio Board Development, UK

T: +44 (0) 20 7333 0800
Office details

Bob Taylor

Managing Partner – North America, USA - Boston

T: +1 617 951 9400
Office details