Private Equity: Unrest at Nordic Capital

After the resignation of his German boss Rainer Lenhard, a change in the local business of the Swedish financial investor Nordic Capital is pending. A partner in Stockholm has taken over responsibility for the German-speaking region from him, while a trio of managing directors now run the day-to-day business in Frankfurt. Industry experts raise the question of whether this construct is permanent – or whether it represents a show run of the three around the final succession of the head of Germany. The Scandinavians are known in this country among other things for their nursing home chain Alloheim. The personnel unrest at Nordic Capital is a topic of discussion at the Frankfurt financial centre. Lenhard, who joined the Scandinavians in 2019 from the investment bank Goldman Sachs, has already submitted his resignation last year, as industry experts report. In addition, there was Philippe Neuschäfer in Frankfurt with partner status, who worked on the segment with small to medium-sized investments. He left Nordic Capital in the summer, as can be seen from his Linkedin profile. In addition, there have been departures from the series of managing directors in recent months. Only consultant Lenhard is still listed as a partner on Nordic Capitals website. However, he is preparing the step into self-employment and only fill out a consulting role, which is likely to end this year, can be heard. Formally, the region Germany/Austria/Switzerland (abbreviated to DACH after the country abbreviations) has been run from Stockholm since February: by Fredrik Näslund, a Nordic Capital veteran who has been part of the Swedish private equity house since 2001 and now serves as a partner and chief investment process officer. According to internal rules, a regional head should be a partner for Nordic Capital. Operationally, the Frankfurt offices Philipp Krispin, Tobias Dehlen and Sebastian Wohlgschaft all lead in the rank of Managing Director, which is below that of a partner. Krispin takes care of the technology and payment services sectors, Dehlen the healthcare industry, charity the small to medium-sized investment business. Nordic Capital confirms the order of the three. Näslund “takes over the regional management and the support of the DACH team and acts as Managing Director”, the investor also informs in writing on request. The investor did not comment on the background and details of the personal details on request. Lenhard declined to comment. A three-pointer – can it work? A crucial question now is whether Nordic Capital is consolidating the current management structure. Do the Scandinavians want to permanently centralize the DACH region, i.e. lead it from Stockholm? This would be relevant for medium-sized family entrepreneurs, for example, because they prefer an experienced local manager instead. On the other hand, none of the three current operational managers in Frankfurt is certified a Gravitas like those of Lenhard. It is quite possible that in the current construction the three should prove themselves and at the end one wins. In any case, a permanent tripartite lead would be unusual in the industry. Even double tips usually only work if the chemistry between the two co-wires works particularly well. Lenhard had initially led the region as such a co-chief alongside a Scandinavian partner. Nordic Capital has been collecting capital commitments from investors for its twelfth flagship fund since the beginning of last year and is expected to be on its last legs, so it is likely to close the money pot soon. Ten companies in the DACH region: in addition to Alloheim, among others, the medical service provider GHD, the industrial technology company Proglove and the credit intermediary Bilthouse, which the investor created from the merger of the major German providers Baufi24, Hüttig & Rompf and Creditweb. The ten companies in the portfolio generate a total turnover of 2.8 billion euros. Two years ago, the financial investor handed over the wheelchair manufacturer Sunrise Medical to the American private equity house Platinum.