Vestum: Exciting add-on acquisition in Pump Supplies - ABG

Acquires UK-based PDAS, adding ~4% to '25e EBITA
A market leader in design, installation, and maintenance
60% of EBITA comes from a growing subscription-based service


An interesting business with room for margin improvements

Vestum announced the acquisition of the UK-based company PDAS, an add-on acquisition to Pump Supplies. PDAS is a UK market leader in proactive maintenance and intelligent monitoring of wastewater pumping stations. We understand that the business consists of three different parts: design, installation, and proactive (monitoring), with revenues relatively evenly split between the three. What excites us most is the proactive part, which involves monitoring of wastewater pumping stations, where PDAS has developed a digital monitoring system that is sold on a subscription basis. As such, proactive is not only the fastest-growing part of PDAS, it also produces higher margins. PDAS as a group generates ~SEK 200m sales and ~SEK 22m EBITA (~11% margins), while our assessment is that profitability in proactive is +20% (currently comprising ~60% of EBITA, according to the company). Over time, we therefore see good potential for PDAS to grow sales and increase its margins to >15%.

Länk till analysen i sin helhet: https://cr.abgsc.com/foretag/vestum/Equity-research/2024/8/vestum---exciting-add-on-acquisition-in-pump-supplies/