We met Claes Hjalmarson find out more about his work and his view of acquisitions.
What is your role at Indutrade?
I am one of the ten people working at Indutrade’s Parent Company. The Parent Company is a firm believer in decentralisation and doesn’t usually get involved in how the subsidiaries run their operations. My time is mainly devoted to acquisitions, financial governance and Board work for some of our companies.
The majority of my time is spent on acquisitions, where one of my roles is to oversee the process – from when the first contact is made to signing the contract.
Why is Indutrade good for the acquired companies?
We don’t make life difficult for the companies we acquire. The companies can continue to operate independently without our interference. They can also continue without us merging them with other companies, since we don’t believe that mergers increase the company’s profit. My assessment is that some 70% of all corporate mergers fail for the simple reason that a minor detail – the people – is all too often overlooked.
If you make too many changes in successful companies, you run the risk of losing key people. We want companies to feel independent, that they still have their names and ideas. The only difference for companies should be that we bear the financial risks.
What do you think makes Indutrade a good company, in general?
Indutrade is a fair and down-to-earth company with real heroes out there in the business operations, who ensure that we can deliver positive results and high shareholder value. There’s not much talk, just lots of action. We comply with laws and regulations and have never been involved in any major scandals.
What is the most rewarding part of the acquisition process?
I think the negotiations are the most rewarding part of the process. It’s a connect-the-dots phase, where we have to give and take to find a long-term solution that will work for all parties involved.
What is the most difficult part of the acquisition process?
The night before signing the contract is probably the most difficult time for companies that are about to be acquired. That’s when a lot of thoughts and feelings can come to the surface. Otherwise, the complexities vary throughout the process. Since all companies face different challenges, the complexities will always vary.
How often do Indutrade’s acquisitions go wrong?
Very rarely, it’s only happened a few times. We perform due diligence before acquiring a company. We prefer to decline or cancel the process if we don’t think it will work.
What type of companies does Indutrade acquire?
We acquire strong niche companies with talented, straightforward people in whom we can trust. The companies must be able to continue operating independently and responsibly without our interference, so it’s vital that we can trust each other.
The companies we acquire fall into two categories. The first is family-run businesses, where the owners are about to retire and don’t have any successor who can keep the business afloat. The other is companies that want to expand but lack the financial resources to do so.
What do you enjoy most about your job?
The best part about my job is all of the interesting people and fantastic companies that I meet.