In late 2005 ARX was introduced to the owners-managers of VUES. VUES was established as a R&D centre for electric machines and drives producers in ex-Czechoslovakia. After a spin-off in the beginning of the 90’s the privatization management team transformed the company into a business successfully focusing on production of low series, R&D intensive electric motors.
The key product lines comprise servomotors, linear motors and special large electrical machines. The products of VUES are further integrated by its clients into equipment used in process automation and robotics, logistics and packaging, automotive and aircraft industries, energy sector, traction production, etc.
The ARX team felt that VUES was an excellent example of an engineering-driven Central European manufacturer with high potential for growth and operational improvement. ARX was attracted by the high concentration of experienced technicians, proprietary technical know-how, as well as the range of in-house testing facilities – which were all uncommon and a result of VUES’ particular history. VUES’ also had a sound business strategy not to compete with mass volume standardized producers, but rather to build competitive advantage by utilizing its R&D capability to design, develop and produce high-quality electric motors to custom specifications for critical end-user applications.
Three of the main VUES shareholders were over sixty years old and wishing to retire, while one additional shareholder was not involved in the business and wanted to monetize his stake. The younger owners-managers, who were key to VUES’ recent success, were keen to partner with ARX and grow the company.
In early 2006 ARX teamed-up with two executives who reinvested substantial parts of their exit proceeds alongside ARX in a tailored transaction, which also provided a succession solution and the desired full exit for other shareholders. The ownership structure was further streamlined by subsequently buying-out over 200 small minority shareholders.
Since the date of the initial ARX investment, VUES has:
- Enhanced its commercial and finance functions,
- Established its own sales affiliate in Germany and increased sales in Western Europe,
- Grown revenues from € 14 million in 2009 to € 24 million in 2012,
- Improved operations and productivity which resulted in EBITDA margin expansion from 12% in 2009 to 21% in 2012, and
- Secured bank debt required to fund investments to significantly expand production floor area.
In 2018 VUES was sold to NYSE listed strategic investor Moog, while generating an attractive investment return for ARX and its partners.