De Stiho Groep (DSG) heads a portfolio of companies specializing in the distribution of building materials and tools. With over 40 branches spread across the Netherlands, the group serves various segments within the construction sector through the Stiho, Bouwmaat, and Baars & Bloemhoff brands. To strengthen DSG's position in the South Holland region and support further growth, the company wanted to acquire a local player.
The challenge
To properly assess the business case, various synergy benefits had to be calculated using models in addition to a stand-alone valuation of the target. This required a good understanding of the business and potential synergies, as well as close coordination with DSG's business department for a thorough assessment.
Beyond the deal
In cooperation with the company, the synergy benefits were mapped out and quantified. Subsequently, these inputs were processed in a dynamic model in which various scenarios were calculated based on the extent to which synergy benefits are realized. This allowed for a solid assessment of the business case, even if not all benefits were achieved. In addition, we contributed our thoughts on other aspects that were important for determining the purchase price, including the acquisition of the real estate.
Based on this model, the business case was assessed positively and DSG acquired 100% of the shares in Alblas Hout. The transaction fits within the broader strategy of DSG to further expand its position in South Holland and to strengthen the network in the region.
The value of sector knowledge
In the building materials and wholesale sector, gross margin structure, logistical efficiency, and the layout of business locations are important factors when assessing a business case. This sector knowledge was valuable in jointly mapping out and testing the assumptions regarding growth and synergy.
