Caphaven Partners, a London-based private equity firm, has acquired a significant minority stake in Deutsche Prüfservice (DPS), a German electrical testing provider. Terms of the transaction have not been disclosed.
Founded in 2015 by Christoph Ulrich Püttmann and based in Erkrath near Dusseldorf, DPS has rapidly grown to become one of the three largest providers of electrical operational safety testing. DPS currently employs more than 170 people and has over 340 customers including SMEs and blue-chip corporates listed on the German DAX. The Company is supported by an advisory and investor board, which includes Dieter Heuskel, former head of Germany at the Boston Consulting Group.
The German electrical reliability testing market, currently worth an estimated €2.7 billion, is growing significantly due to the recurring business generated by regulations requiring regular equipment certification. Demand for qualified and compliant service providers has grown considerably as customers opt for independent rather than in-house testing. DPS offers its customer base, which ranges from retail outlets to large factories, a comprehensive and legally compliant testing service including mobile and stationary equipment, machine and infrared thermography as well as project planning.
Caphaven began its partnership with DPS earlier in the year by arranging expansion capital in the form of a convertible loan. The firm has now extended its relationship with DPS by providing financial, strategic and operational support to realise its growth ambitions over the coming years. Caphaven’s Cornel Riklin, Sebastian Sipp and Berent Wallendahl have joined the DPS board and with their support and expertise, DPS will be well placed to expand both organically and through acquisition to further strengthen its leading position in a rapidly consolidating sector, characterised by sub-scale, regional players. A key part of this will involve a considerable investment in DPS’s operational and technology infrastructure that can support a much larger company in the future.
Cornel Riklin, Founder of Caphaven Partners, says: “As experienced investors we look forward to partnering with the management team to provide strategic and operational support to maximise DPS’s organic growth potential. The German electrical testing remains highly fragmented and is ripe for consolidation. There is also a substantial opportunity for DPS to complement its organic growth through strategic acquisitions.”
Sebastian Sipp, seconded from Caphaven Partners as the interim CFO of DPS, said, “We are excited at the prospect of working closely with the management team to enable the company to reach the next level of growth. The Caphaven team has longstanding experience in working with high growth businesses and DPS has the right ingredients to achieve rapid scale over the coming years.”
Christoph Ulrich Püttmann, founder and CEO of DPS, says: “We are delighted to be partnering with Caphaven. Its track record in working with high growth companies and understanding of the industry dynamics convinced us of its ability to successfully capture the market opportunity in Germany. Caphaven’s vote of confidence in our business model and shared vision provide strong foundations for success and we look forward to working closely with its experienced team to reach the next phase of our growth journey.”