Due Diligence prior to M&A transaction
EQT is a leading alternative investments firm with approximately EUR 40 billion worth of assets under management across 20 active global funds. EQT funds have 141 portfolio companies with 159,000 employees, generating c. EUR 27 billion in total revenues.
In 2016, Dehns partner Matt Hall was contacted by Oslo law firm Thommessen on behalf of EQT when EQT was looking to acquire Norway based company AutoStore AS, who have developed a unique automated warehouse storage and retrieval system with, at the time, more than 130 installations in 22 countries.
EQT required Dehns to carry out due diligence on AutoStore’s portfolio and address any issues surrounding the strength of the IP portfolio and Freedom to Operate over third party IP rights, as well as advising on a dispute involving UK online grocery retailer, Ocado. This was particularly challenging because of the sheer volume of work required for assessment of AutoStore’s 27 patent families that it had at the time, as well as numerous patent families owned by Ocado and other third parties that required review in connection with FTO. It was crucial that Dehns made sure EQT fully understood the IP portfolio and any problems in relation to AutoStore’s IP position.
Working alongside the Dehns engineering team and with Dehns partner Adam Taylor, Matt was able to mobilise multiple attorneys and trainees in order to arrange for Dehns to absorb a vast amount of work in a short space of time, so that EQT had all of the answers they needed to go ahead with the acquisition process within their required timeframe. Dehns worked closely with EQT and hommessen throughout the whole process so that they had a full appreciation of the strengths and weaknesses of AutoStore’s IP position, as well as potential future issues. The advice from Dehns was used to enhance EQT’s assessment of the value of AutoStore based on the strength of their IP portfolio, which is vital for transactions of this nature.
EQT was successful in acquiring AutoStore with a deal that fully satisfied both parties. AutoStore was impressed with the work carried out by Dehns in connection with the EQT transaction and they have continued to consult Matt in relation to on-going IP matters to augment the work done by AutoStore’s Norwegian patent attorneys.
From the time of the acquisition in 2017 to June 2019, AutoStore experienced exponential growth, with quadrupled revenues, a 4.5 EBITDA increase and a doubling of the employee base. This growth was in part due to Autostore broadening its market through new R&D patentable innovations – assisted, of course, by Dehns.
In June 2019, just two and a half years after completing the acquisition, EQT sold Autostore for a significant amount (c.3-4 times) more than it paid in 2017.
Autostore continues to go from strength to strength: it now has more than 500 installations in over 30 countries, and it's patent portfolio, under the continued guidance of Matt Hall, has now grown to over 150 patent families.