Good day and thank you for standing by. Welcome to the Multiconsult-Rejlers: A Merger of Equals conference call. At this time, all participants are in a listen-only mode. After the speakers' presentation, there will be a question-and-answer session. To ask a question during the session, you will need to press star one one on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, please press star one and one again. Please be advised that today's conference is being recorded. I would now like to hand the conference over to your speaker today, Viktor Svensson. Please go ahead.
Thank you very much. To everyone connected, we say very welcome to today's presentation of a proposal of a merger of equals between Rejlers and Multiconsult. We will start with a short introduction of the five speakers available. I will start with myself, Viktor Svensson, CEO of Rejlers. I have 24 years in this industry. I started my career in technical consulting when I was 27 years old and started in the group management team of ÅF, currently named AFRY. I worked 15 years with ÅF during a period of time when we transformed the company in terms of growth, profitability, and employer brand. I ended my career at ÅF as a divisional head in late 2017.
Then I started as the CEO of Rejlers in February 2018 with a very clear target of turning the company around in terms of growth, profitability, and employer brand. I've been here now for eight and a half happy and speedy years, and we have had a good start, if you can call eight and a half years a start. I have a very strong devotion to this industry because it's all about people and to get a warm and winning culture on board and looking very much forward to this fantastic merger. I'm handing over now to my future colleague, Kristin.
Hello, I am Kristin Augestad, and I'm really excited to be here today. I am the Interim CEO of Multiconsult, and I'm also Executive Vice President for Norway. I've been with Multiconsult for almost 30 years, and I've been a member of the executive management team for several years, where I've also been responsible for our architecture segment. Together with Viktor and I here today, we also have-
I am Anna Jennehov. I am CFO of Rejlers AB. I have been the CFO for Viktor since almost eight years ago. A lovely journey. Looking forward to hopefully next journey, and I have a background as a CFO for listed consultancy companies for more than 20 years. I hand over to-
Rikard Appelgren. I am the Chairman of Multiconsult Group, and I have almost 40 years of working experience in this industry. Mainly 18 years in WSP Group, which I left 10 years ago, and I joined the Board of Multiconsult eight years ago. This, what is happening today in front of us, it has been a thought for a long time, and I am very excited about the common future with the Rejler family and to put a new very big and stable company on the Nordic market.
Yes, and I am Peter Rejler. I have been in this business for 60 years. That is how old I am, so I was born into it. I have been the CEO of the company, and I am now the Chairman of Rejlers.
All right. First, a brief summary of Multiconsult. We are more than 4,000 employees in the group working on projects spanning more than 45 countries. We participate in approximately 15,000 projects each year for more than 5,500 clients. Through this, we have delivered profitable growth based on a robust business model with a diverse portfolio and strong professional environment that can assist our clients with their challenges across business areas and geographies.
Yes. On the Rejlers side, I think that this slide is showing that we have had simultaneously nice and successful rides during the last couple of years. At Rejlers, we have been focusing a lot past eight years on leadership, operational excellence, employer brand, and to have a stretched strategy. We have doubled the size of the company with a solid mix of organic and M&A growth. Largest acquisitions have been Neste Engineering Consulting in 2019 and Eurocon 2023.
Our EBITA is up 7x or actually 10x if you go with the actual results, giving a development from EBITA SEK 37 million in 2017 to SEK 370 million last year. Still, the one thing that I am most happy about with the development of Rejlers so far is the employer brand. Today, we are in a naturally strong recruiting position in all markets. Our organic outlook is stronger than ever. All right. Moving on in the presentation. This is the first early summary slide of what we are proposing today, and let me be very honest and maybe even a bit emotional with this starting picture.
As I said, after literally living in the tech consulting landscape for 24 years now and monitoring all and every competitor every quarter, I want to call the proposed merger of Multiconsult and Rejlers the perfect match. I honestly can't see a better match in the Nordics currently. I am basing that on a lot of bullets, but mostly on culture, on size, and the geographical fit. I have learned to know Multiconsult over the last year, and I can see that we share a lot of the core values. Core values of a strong portion of humanity, empathy, but combined also with a strong winner's instinct, which is my favorite combination, and we will protect this going forward.
The size of the companies are almost the same, and also the journey that we have behind us. Thirdly is the geographical fit, which I think is unique when it comes to a merger of this portion. Because I think we all know monitoring this industry, that the hardest part when launching a big merger is when you have 50- 100 offices in the same cities all over the place, where you have built up a leadership on one side of the main street of the city and on the other side of the street you have a similar office building a strong leadership.
You are supposed to choose the new leaders of that very city in 50- 100 places. That is a big obstacle. That is a big challenge. In this case, that problem or hurdle is in very few places. That is a unique thing with what we are proposing today. This is very much of business as usual, but with a great twist. We will jointly create a company that will be much more of an institution, standing tall in a complex and fast-changing world with a total of SEK 11.7 billion in total sales, EBITA SEK 795 million, and some 8,000 highly skilled engineers. I am very excited. Kristin?
Just to state what Viktor just said, in short, we are a really, really strong match. This merger brings together two highly complementary organizations with strong control fits, deep technical expertise, and complementary geographic footprint. We will be preserving the strength of both companies while creating a stronger Nordic platform for future growth.
The combined company will benefit from balanced leadership, a dual listing in Stockholm and Oslo, and the support of two committed long-term owners, Stiftelsen Multiconsult and the Rejler family. On today's agenda, we will take you through the strategic rationale behind this proposed merger, give you some figures for the combined group and merger parameters and indicative pricing. At the end, we will have a Q&A session.
Great. We are moving on, and this slide is very much about to try summarizing a few key benefits of today's proposal. I think one very important element that we have seen together during our early work with our proposal today is that we are forming a top three player in the Nordics when it comes to energy and industry. That is where we landed when we really dig into each and everyone's business here. Looking into the fundamental needs of energy and industry in the Nordics for the coming 5- 10 years, that is a very good place to be.
We might even say that in a couple of years, we will be number one in industry. We are projecting massive investments in nuclear, in defense, and in energy in the Nordics for the 5- 10 coming years. So we will have a very interesting position. Secondly, we are emphasizing the employer brand because if there is anything I have learned from 24 years in this business, it is the importance of a shining employer brand. That is a top three priority for a company like ours.
With a joint story we are having on the table, I am sure we can build a shining employer brand together in the Nordics. Thirdly, we will be a top five player in our industry in the Nordics. You can say whatever you want, but size matters in this business. If you want to be a contender for the biggest future project in society, in industry, in energy, you need to be in the top. Both of our companies, we have been on the borderline of getting there, but not really.
With this merger, we will be a top five player and a natural contender for the biggest projects in the Nordics. Fourthly, we have rated, of course, IT and AI, $1 million question for every industry globally. What we can see is that there is not one employee in Multiconsult or Rejlers who is not using AI today in making our clients more efficient. But we need to invest more. We need to evaluate our business models and so forth.
Together we will be stronger here. I am very impressed with what we can see what Multiconsult have done and where you are in this space at the moment as well. I want to say that. Finally, of course, we see great synergies when you merge two similar companies of this size, stock listed, and we have identified cost synergies in between SEK 100 million-SEK 120 million that will be gradually taken during a period of three years.
It is mainly within IT coordination, but it is also within procurement and in very obvious areas that you will not need two management teams, group management teams. You will not need two Board of Directors. You will not need two annual reports, two sustainability reporting. I am not worried about this level. We have a very sophisticated program on picking those SEK 100 million-SEK 120 million over a three year period. Thank you for that, and moving to the next slide.
This slide is what I just talked about as the priority three for us, getting the position of being the fifth biggest player in the Nordics and getting up there, being a natural contender for the biggest project is a clear position that we both are striving for and getting now, and there is a clear value in this. There has been frustration in both sides on not really being seen as a top five player. We can also see that the new company have a strong foundation in four areas of what I have talked about, industry and energy. When we say industry, we include defence infrastructure, buildings, and also within water treatment, where Multiconsult is impressively strong and Rejlers have intentionally grown fast over the last years. Moving on.
This merger will enable us to create additional opportunities for complex and meaningful project work and enable stronger subject matter expertise and career opportunities for our employees. Viktor and I have met several times over the past month, and we share a common vision on how we want to develop this new group together. Rejlers is focused on many of the same things as Multiconsult are: building a culture where we put our clients first, where we look after each other, and where we put competence, learning, and knowledge sharing at the center.
Our combined culture will be built around technical expertise, learning, and collaboration. Together, we can offer employees broader professional communities, more development opportunities, and an even stronger platform for attracting and retaining talent. This merger is first and foremost about creating greater value for our clients and our shareholders. By bringing together complementary expertise and geographic reach, we can offer broader services to more clients across the Nordics and beyond.
We see clear opportunities in combining our Nordic capabilities on defence, on coastal and Arctic services, on energy, and on infrastructure projects. Collaboration between the architects from Multiconsult and the engineers from the whole group will enable earlier involvement in projects and potentially increase our market share. By sharing expertise across countries, we can offer more holistic solutions and accelerate growth.
Super. This picture is mainly about to summarize a few basic facts saying that we see obvious benefits in coming together for joint investments in employees, AI, and in our new service offering. We will start with a strong balance sheet with a net debt of 2.1x, and saying that it goes without saying, M&A will not be our focus for the first 12- 18 months. The net debt will decrease alongside with integration. Thereafter, we will be back with M&As, an area where both companies have succeeded well during the last five years.
We also see that we will be able to elevate our stock market story for the coming years, but that is naturally to prove. But we see immediate room for improvement in stock liquidity and broader European interest in our share that will be listed both in Stockholm and in Oslo. As I said, this is a perfect match to me and to us in the way that we will not have 50- 100 offices to integrate and choose who is the local manager. Multiconsult is dominant in Norway, and Rejlers is very strong in Sweden and in Finland. The geographical overlap is very gentle.
But still we have identified three clear organizational changes that will benefit each operation. Firstly, we will integrate Rejlers Norway with 250 highly skilled employees with Multiconsult Norway. It is evident that Rejlers Norway will gain from becoming part of a market-leading position with all the relevant framework agreements at hand, the employer brand position Multiconsult have earned in Norway, and a new network of 3,400 colleagues in Norway. Secondly, we see a clear upside of moving Multiconsult Swedish infra company, Iterio, into Rejlers Sweden.
The reason for this move is very much like the move in Norway that I just mentioned. Thirdly and finally, we are moving Multiconsult Poland with 400 skilled employees within infra and industry into our most international entity, Rejlers Finland, running a daily business with major assets and operations in the U.A.E. and India. The international approach from our Finnish management will take the Polish operations into a new context, I am sure. I am also happy that these organizational changes have landed very well with all parties involved before today's launch.
The combined group will have four Nordic home markets, giving us a strong local presence across the region. As Viktor has stated several times, our footprints are highly complementary. Multiconsult has extensive coverage in Norway while Rejlers is well established in Sweden and Finland. Our Nordic platform is further strengthened by strategically important and fast-growing international operations. Because there is limited geographic overlap, the combination expands our reach from day one.
Over time, we will of course optimize the office network and bring locations together where this improves collaboration, efficiency, and client services. This is the proposed structure for the combined group with clear country-level responsibility and architecture as a separate segment. For most employees, it will be business as usual, with the vast majority retaining their current manager. The structure is designed to maintain client focus while enabling revenue and cost synergies. Our headquarters will be in Stockholm, with a main office in Oslo, and group functions will be shared between the two locations.
Yes. I have a truly solid feeling with this slide with the constitution of my coming management team for the new group. We have strived for a solid blend from both companies, and this is what it looks like. As important to me as who is at the helm for every position is that we steer with pure clarity. The P&L, the profit and loss streams must, in my book of leadership, be crystal clear. In the new company, the four engines for growth results and development will be run with the four P&Ls of Norway, Finland and International, Sweden, and as number four, a pure P&L with architects, 600 architects in Denmark, Sweden, and Norway.
We have a good mix between the companies in the new management team. I must also add that the meetings I have had with the persons on the screen makes me even more excited about the journey to embark. It is great people with a strong drive and a great portion of humanity. Kristin will, apart from being responsible, ultimately responsible for the P&L of Norway, be Deputy CEO for the group with responsibility for strategy and business development. The headquarters will be in Stockholm and the main office in Oslo. Main office means a lot, but basically the ultimate responsibility for finance, meaning CFO and group coordination of both IT and HR. Extremely important positions for a consulting company. Anna Jennehov starts as the CFO.
Thank you.
At least from what I've heard. You know, Anna, how happy I am for this, and so is everyone, because the first year will be very important with the financial integration. Within one to one point five years, the next group CFO will be recruited and have its home address in the main office of Oslo. All right. Mine and Kristin's final slide. Here are the consolidated financial statements for the joint group. We are reaching a total revenue of SEK 11.7 billion with an EBITA of SEK 795 million , and a consolidated EBITA margin of 6.7%, looking at rolling 12.
We will keep our targets of 10% annual growth and EBITA 10% over a business cycle. How to leave the current 6.5%-7% levels for 10%, we will come back to. I can already now say that the important elements will be higher utilization than the consolidated levels, SEK 100 million in synergies from the merger, and certainly getting our lowest performing entities to substantially improve for the coming years.
Yes, hello, this is Peter Rejler talking. Not only are the two companies a perfect match in geography, culture, technology, et c, but it is also a perfect match between Stiftelsen Multiconsult and the Rejler family. Multiconsult have a history that reaches as far back as 1908, and Rejlers as far back as 1942, approximately 200 years of knowledge and experience now in one company. Stiftelsen Multiconsult was founded in 1974 to secure its long-term development and to safeguard the company's culture, as well as the well-being of its employees and business, which is exactly what the Rejler family school has been for 82 years.
So who are we, the Rejler family? Well, we are three generation of engineers. It started with my grandfather in 1942, and it's not ending with me. I have a lot of children, six of them, of which three are studying to be a Master of Science, which I'm very proud of. The continuance of the generations will go on. Decade- after- decade have we been adapting to new technologies and challenges that has been, and I think, well, we have succeeded pretty good. With that, I will leave over to Rikard.
Okay. Thank you, Peter. Rikard here, and I will take you through the key merger parameters and the indicative table. I can say that these are the results of good negotiations between the Boards and management in each company. They've been in very good pace, and I think that the result that I would present is based on our responsibility to take care of our shareholders in each company. I think it all starts with we do the announcement today. This will follow with an EGM in each company. The plan is October 19th, where the shareholders will be able to vote on this merger.
As an information, I think it's important to say that behind the Rejlers shareholders, we have the Rejler family and other longstanding shareholders that have representing 18% of the share of the capital and 51% of the votes in Rejlers that have undertaken to vote in paper. On top of that, we also have three larger [pounds] representing 31% of the shares and 90% of the voters that are supportive of the merger. On the same issue in Multiconsult, we have our long-term shareholder, Stiftelsen and others that represent 37% of the votes that have undertaken to vote positive to this merger.
It seems like there is a good understanding of the drivers behind it. The base for this merger is an exchange ratio of 0.9725, resulting in a 54% ownership for Multiconsult shareholders and a 46% ownership for Rejlers shareholders, which is very close to the 45-day VWAP per September 2nd. The exchange rates of the shares represents a premium of 1.7% for Multiconsult and a discount of 2.0% for Rejlers compared to the last closing price.
As Viktor has said, there will be a dual listing on the Oslo Børs and in connection to closing up this merger later on this year. As a final information, a new nomination committee led by Arnor Jensen, who is the Chair of Stiftelsen Multiconsult, will be appointed and in consultation with them, a new Board will be put in place and announced later. With those words, I will just say a few words on the timetable. You've heard it already. We announced today we plan the extraordinary general meetings on October 19th, and the ambition is to close this merger and have the dual listing on Oslo Børs in place late 2026, early 2027. Thank you.
Okay, now it's time to go over to the Q&A session.
Thank you. We will now begin the question and answer session. As a reminder, to ask a question, please press star one one on your telephone and wait for your name to be announced. To withdraw your question, please press star one and one again. Once again, that's star one and one to ask a question. We will now take the first question from the line of Johan Dahl from Danske Bank. Please go ahead.
Yes. Good morning, everyone. Just a few brief questions. I was just interested to hear, in Rejlers, it's been some operational challenges in the last 6- 12 month period. I'm just wondering from the Rejlers side, when you look on Multiconsult, how do you think it's performing? If you take a top-down view, look at it over the cycle. You referred to some potential, Viktor, on turning around underperformance, et c, but just the general perception of how Multiconsult is performing today.
Yes, Johan. I think you're referring to that we have had a volatile journey in our Norwegian operation. I think that this proposal is also an answer to our Norwegian issue. Coming back to your core question, I think that what we can say is that Multiconsult have a very strong position, growth, and profitability in its core operations in Norway, but obviously weaker profitability in the architectural segment and also in the international segment, which basically is the Polish business. That's what I was referring to. But very strong profitability, very strong business, in the Norwegian space.
Yeah, got you. Just two follow-ups. Firstly, on what you are trying to create on architecture, this franchise. Perhaps can you dwell very briefly on that? What you aim to achieve within architects, perhaps looking a few years out. Second also, Viktor, on how does this transaction affect your commitment, in terms of being the CEO? You have always been super committed in Rejlers. Does this in any way change that commitment to being for longer, for more, or just interested to hear your view on that. Thanks.
I think, the first question, when it comes to the architects. For me, it was very important of giving them a pure P&L in the group management team so that we can monitor every quarter, and how the profitability will develop. So we are not hiding, because that could be one strategy. I want to be very transparent, and we will walk into this merger, with a target of making the architectural business much more profitable, and have a fruitful combination with the rest of the group. If we are not succeeding, then let us see, what to do.
That goes for every business in every company. I am just saying. Every entity with an evidently lower profitability than the rest will have a spotlight. They will be in the limelight forever under my management. So that is the baseline. The second question is that, yes, I have been super committed to the Rejlers assignment, and with this, if it is possible to go beyond that is what I am going to do. I am super committed, Johan.
Got you. Thanks a lot.
Thank you. As a reminder to ask a question, please press star one and one on your telephone and wait for your name to be announced. That is star one and one. There are no further questions at this time. I would now like to turn the conference back to Viktor Svensson for closing remarks.
Well, then we are saying from the Norwegian and Sweden side, thank you for listening in. We are close to overexcited this very morning. It is a fantastic way of starting a new week. We have been working extremely hard getting here, and I think we all have been in similar situations, but not reaching where we are today. That also makes us very excited. Now the hard work starts, and me and Kristin and the rest of the group management team, we will make everything in our power to make this something special.
That goes from Q1. We need to remind ourselves of that. Back to business from tomorrow, and then we will look forward getting together for a real run from next year. Thank you very much for listening in, and we are, of course, available the rest of the day with Anna , Kristin, myself, if you want a private conversation. Thank you very much.
This concludes today's conference call. Thank you for participating. You may now disconnect.