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R ATOS CASE

WHEN COMPLACENCY STANDS IN THE WAY OF CHANGE, A FRESH SET OF EYES CAN MAKE THE DIFFERENCE

TIME FOR CHANGE

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ew business ownership can seem like a trivial topic, but time and time again, it has been proven that having the right ownership can make a tremendous difference and bring positive change for everyone involved – the management team, the employees and the customers. This is the story about a company that had “fallen asleep”, but was bought by a private equity fund and awoken to reach its full potential.

Per adds: “We saw a great potential in developing the company commercially by creating new products and attracting new customers, and that’s what made us curious. Our goal was to make Stofa a stronger and more efficient company able to compete against the largest player in Denmark, YouSee”.

Our story begins in the summer of 2010, when the Swedish private equity conglomerate Ratos bought the Danish cable TV and broadband company Stofa from its previous owner, TeliaSonera.

hen Ratos took over Stofa in August 2010, they had a clear view on what direction they wanted to take. They found that Stofa needed to become more efficient, to develop a clear strategy, including more ambitious goals to strive for, and that the company would benefit from a more aligned management team. A breath of fresh air, so to speak.

“The company had lost its energy during the last few years of TeliaSonera’s ownership, as it was

“ When we decided to acquire Stofa, our decision was based on an exhaustive due diligence into TeliaSonera’s overall of the company and a clear conclusion that it would make sense. We have great respect for the strategy”. companies that we acquire, and we know how difficult change can be. But in the case of Stofa, changes were needed, because the company was, in many ways, still operating as it did when it was much smaller. The company had lost its energy during the last few years of TeliaSonera’s ownership, as it was clear that it didn’t fit into TeliaSonera’s overall strategy,” Per Frankling, Investment Director at Ratos, explains.

clear that it didn’t fit

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The focus of the strategy was based on Stofa’s four product categories, which define the business: TV channels and packages sold through antenna associations, broadband, Voice over IP (VoIP) and interactive TV sold to individual customers.


It’s one thing to define a new strategy; it’s quite another to get buy-in from the organisation and be able to execute the needed initiatives. We actually expected this to be a difficult task, since Stofa was partly stuck in old habits and had developed their own views on how to serve the customers; views that were a bit too much inside-out, and not seen from a customer and owner perspective. Stofa didn’t have a clear overview of the complexity in the organisation and the weak link between product areas, sales activities, customer service and field technicians. The management team had a positive attitude to this challenge and a candid desire to create a more efficient and modern organisation,” Per says with a smile. The profound interest shown by the board and Ratos in Stofa’s future development created a very positive effect on the company, according

to Per: “Today, we see that everyone in Stofa knows which way the company is heading and what is expected from them. Everyone takes great pride in achieving the defined milestones and targets. And most importantly, everyone is working in the same direction”.

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he result was not only a close-knit management group, but the process also produced exceptional results on the bottom line. With the new strategy and the execution of a number of important initiatives, Ratos has managed to improve the EBITDA margins by 21 per cent in around one year – from 185 to 225 million Danish kroner. These impressive results come from new customers in broadband and VoIP, increased TV sales, add-on services and cost savings. A change in ownership can have a big and positive effect, especially when the new ownership is close to the business. Ratos has brought new perspectives and ideas to the table and has been able to identify inexpedient processes and inefficient elements in the organisation, to which Stofa themselves had become blind. Today, Stofa is a stronger and more competitive company, and one of the best performing in Ratos’ current portfolio of 19 companies.

Per Frankling,

Investment Director at Ratos

June 2010

February 2011

June 2011

August 2011

Ratos acquires Stofa from TeliaSonera.

Stofa’s management and Ratos begin formulating a new strategy.

The new strategy, Strategy 2014, is launched internally.

A new CEO, Klaus Høeg-Hagensen, is appointed. The previous CEO is appointed vice-chairman of the board and is still working in Stofa.

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