Midwich to widen European footprint post IPO

Expansion into Netherlands, Poland, Spain, Italy and Switzerland on the agenda in medium term, managing director Stephen Fenby tells CRN

Midwich has set its sights on expanding further into Europe after announcing its first results as a public company.

The distributor saw revenue jump 12 per cent year on year to £158.4m for the six months ending 30 June, with adjusted operating profit increasing 23 per cent to £7.9m in the same period.

Speaking to CRN, managing director Stephen Fenby said that, while acquisitions in the short term are not likely, Midwich will be looking to boost its presence in mainland Europe in the future and will look to acquisitions as a way of moving into new territories.

"Having just bought two businesses we won't be doing anything in the very short term because we have to look after those, but we do have a number of conversations on-going which we will continue to do," Fenby said.

"Our primary focus is in the European market, so we have a presence in the three biggest markets, but if you look down the list of other territories there are targets over the medium term such as Netherlands, Poland, Spain, Italy possibly, [and] Switzerland.

"The world is our oyster and we've now got better [acquisition] ability to follow that strategy, so there are plenty of options."

Last week Midwich acquired UK-based Holdan and New Zealand distributor Wired.

Fenby didn't rule out further acquisitions in the UK but said they are unlikely at this time. He added that if they were to acquire a UK company it would most likely be a specialist business to move Midwich into a new sector.

Having launched onto the Alternative Investment Market in May, Fenby explained that, with Midwich having been through four management buyouts in the last 14 years, the management team wanted to provide some certainty around the company's future ownership, while retaining independence.

"There are a number of other factors [for going public]," Fenby added. "Firstly, we raised some cash which strengthened our balance sheet and gave us more clout to go out and strengthen our strategy further.

"[Secondly] we think being a public company gives us a bit more prestige and stability on the world market. Companies who don't know of Midwich will see we're a public company and know the security and compliance process we went through to become public."

As part of the IPO Midwich gave shares to all of the management team and employees who have been with the business for more than a year.

Despite Midwich's activity in the AV space, Fenby highlighted that the traditional print business is still as important to the distributor as ever.

Midwich recently restructured its document solutions division to reallign the sales side and purchasing side of the division, and improve the services offered to vendors and partners.

"We're not just an AV distributor and my print colleagues sometimes get a bit upset if everyone talks about AV, but we're still very proud of our print activity," Fenby said.

"We've long been out of the computer market but print is still an important part of our business. It remains a very big market and it's still a market that I believe we've got a future in."