EQT's business model allows the portfolio companies to develop and grow with a high sense of urgency. Consensus around strategic direction for a company is a prerequisite, since the partnership with management and the Board of Directors is key as they run and develop the business. Once a company has been acquired, EQT appoints a Board of Directors, which in turn apply EQT's corporate governance model and, when needed, the management team is strengthened.
The strategy acts as a roadmap for value creation and progress is closely monitored. Key strategic measures typically include:
- Market and product expansion – targeting new customer groups or broadening the product offering, which could mean new products in existing categories or applying a proven technology to new product categories.
- Internationalization – a key benefit, given access to the extensive international network of Industrial Advisors and EQT’s global platform.
- Add-on acquisitions – step-by-step expansion by acquiring competitors or companies with similar or complementary products, technologies or market presence. The ambition is often to achieve economies of scale and drive internal efficiency. It may also mean driving consolidation of a fragmented industry.
- Access to broad expertise in industrial management helps the portfolio companies to increase efficiency and profitability. State-of-the-art benchmarking and assessment methods are installed. The ambition is typically to become “best-in-class” in such areas as production, customer relations and service.
EQT’s digital team is working with a dual role - supporting existing portfolio companies and pollinating the EQT organization with digital skills and new, more efficient ways of working. The mission is to accelerate both groups’ expertise and capabilities within tech and the digital space in order to future-proof them for the long-run.
EQT considers responsible investment and ownership principles and practices, including the consideration of material sustainability aspects, as an integral part of each phase of the investment and value-creation process. Read more about Sustainability here.
Access to broad expertise in management helps the portfolio companies to increase efficiency and profitability. State-of-the-art benchmarking and assessment methods are installed. The ambition is typically to become best-in-class in such areas as production, customer relations, digitalization, sustainability and service.
Utilizing changing industry dynamics, investing in future technologies and divesting non-core businesses, to create a base for rapid expansion.
Optimizing Capital Structure
The EQT funds have access to the financial expertise that can be applied to create efficient capital structures and, ultimately, prepare the improved company for the transition to a new owner.