Information on the Target

Waterlogic, headquartered in Maidenhead, UK, is a renowned designer, manufacturer, distributor, and service provider of purified drinking water dispensers. The company has recently finalized the acquisition of a significant minority stake by four notable institutional investors: British Columbia Investment Management Corporation (BCI), Neuberger Berman, StepStone, and Skandia. This transaction was initially announced in January when BCI agreed to acquire a significant minority stake from the funds managed by Castik Capital and the Waterlogic management team.

Waterlogic operates in 17 countries, including the UK, USA, Canada, and Australia, with a vast independent distribution network covering over 50 countries. The company caters to approximately 50 million consumers daily and actively participates in the reduction of single-use plastic bottles globally, with an annual contribution of 23.8 billion bottles eliminated from circulation. Waterlogic aims to expand its customer base and enhance its offerings through innovative hydration solutions, such as freestanding and countertop dispensers.

Industry Overview in the Target's Specific Country

The drinking water dispenser industry has experienced significant growth globally, propelled by increasing consumer demand for sustainable and health-conscious solutions. In the UK, the trend towards reducing plastic waste has led to heightened awareness about the need for alternatives to bottled water, which aligns with Waterlogic's mission. The UK market is currently witnessing robust investments in eco-friendly technologies, thus driving industry growth.

Additionally, many businesses are keen on adopting environmentally responsible practices, further solidifying the demand for cleaner water solutions. UK consumers are increasingly advocating for greener choices in their workplaces and homes, making the bottle-less water dispenser market exceptionally promising. The rise of remote and hybrid working models also contributes to the trend as companies seek cost-effective ways to provide hydration solutions without reliant on traditional bottled water deliveries.

Regulatory support for sustainable practices in the UK is enhancing market prospects as the government promotes initiatives aimed at reducing plastic use and minimizing environmental impact. Waterlogic’s proactive approach aligns well with these government policies, positioning the company as a leader in the rapidly evolving sector.

Furthermore, advancements in water purification technologies and increasing investments by public entities to enhance drinking water quality are creating significant opportunities for players in the industry. As a pioneer in pioneering technologies like Firewall™ and BioCote®, Waterlogic is well-equipped to cater to the future demands of the market.

The Rationale Behind the Deal

The acquisition of a minority stake by these institutional investors presents a vital opportunity for Waterlogic to access additional capital. This influx of investment will support the company's ambitious growth strategies, particularly in its focus on expanding operations in the fast-growing workplace hydration segment.

Jeremy Ben-David, the Founder and Group CEO, expressed optimism regarding the acquisition, underlining Waterlogic's resilience amidst challenging economic conditions. The strategic partnership with these renowned investors is expected to enhance Waterlogic’s market position and expedite its journey towards becoming the global leader in innovative hydration solutions.

Information About the Investor

British Columbia Investment Management Corporation (BCI) is one of the largest institutional investors in Canada, managing C$153.4 billion in assets as of March 31, 2019. BCI primarily serves the public sector and its investment strategy emphasizes long-term value creation across various asset classes. Joining BCI, Neuberger Berman is an independent investment management firm that specializes in global equities, fixed income, and private equity, focusing on delivering value to its clients throughout the investment lifecycle.

StepStone, also participating as a minority shareholder, is a global private markets firm that creates customized investment solutions for sophisticated investors worldwide. Skandia, a mutual life insurance company based in Sweden, brings experience and extensive resources in providing pension, banking, and insurance solutions, further enhancing the financial backing for Waterlogic's growth ambitions.

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The acquisition represents a strategic movement for Waterlogic, targeting sustainable growth in a market that is increasingly prioritizing eco-friendly solutions. By aligning with such reputable institutional investors, Waterlogic solidifies its financial foundation through availability to diverse capital resources, which is essential for its expansion plans. The strategic entry of BCI, along with other notable investors, reinforces confidence in Waterlogic’s business model and operational strategies.

Moreover, the current global environmental context, with strong momentum toward sustainable practices, makes this investment highly relevant. Waterlogic has consistently proven its capacity to adapt and innovate, supported by state-of-the-art technologies aimed at enhancing water safety and quality. Consequently, this investment embodies strong potential returns, meeting both financial and social responsibility objectives.

However, it will be crucial for Waterlogic to effectively manage its resources and strategically implement its growth plans to leverage this investment fully. The success of the minority stakeholders will equally rely on the company's ability to execute its market penetration strategies while balancing stakeholder expectations.

Overall, this acquisition highlights a promising future as Waterlogic continues to pioneer sustainable solutions in the drinking water sector. Current trends indicate a robust market potential ahead, ensuring that this investment could yield advantageous outcomes for all parties involved.

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