Hydroline Oy, a family company based in Siilinjärvi, Finland, supplies top-grade hydraulic solutions to global manufacturers of machinery and equipment. Now the company is seeking strong international growth with a boost from a multi-million-euro investment from Juuri Partners Ltd. The ultimate goal of the company is to make the world’s best small-series production to meet the demanding needs of equipment manufacturers.
Hydroline Oy, a Finnish market leader in its field, creates and manufactures innovative hydraulic solutions for global industrial giants including Agco, Bronto Skylift, Cargotec, John Deere, Normet and Sandvik. The company specialises in hydraulic cylinders, and its products – cutting-edge technology used in moving machinery – are tailored to its highly demanding customer base. Hydroline Oy is now seeking strong international growth thanks to a major investment by private equity firm Juuri Partners, enabling it to grow internationally and to challenge the competitive status quo in the sector. The investment is a significant part of a financial arrangement worth a total of approximately EUR 20 million.
“We need additional capacity as the market is doing very well at the moment. Juuri Partners’ investment will enable us to channel financing into our existing production plants and play a part in market consolidation. Increased capacity will also have a positive effect on employment,” says Mikko Laakkonen, Hydroline’s CEO.
The third-generation family company currently has approximately 250 employees, of which some 20 employees work at the factory established in Poland in 2014. The company’s net sales in 2016 were EUR 36 million, and an increase of 20 per cent is forecasted for this year. Approximately 95 per cent of net sales go indirectly to exports.
The family remains the majority shareholder
Hydroline Oy is Juuri Partners’ first industrial production investment. It also takes Juuri into a new order of magnitude in terms of size.
“This investment again highlights Juuri Partners’ model of being a minority shareholder in its portfolio companies and a strategic partner for entrepreneurs. For Hydroline, it was very important for the family to retain its majority shareholding in the company following the transaction,” says Anita Ojala from Juuri Partners. “The company has reached a very interesting stage on the cusp of major growth. Overall, the market is worth several billion euros, and high-end products like the solutions offered by Hydroline stand to take a large portion of this.”
“Juuri Partners has a very similar philosophy to us when it comes to developing our operations. For us, it is important that Juuri believes in family companies and is used to working with them,” says Jukka Laakkonen, Chairman of the Board of Hydroline. “In addition to financing, Juuri Partners will provide us with strategic expertise to help with our international expansion and the work of the Board of Directors.”
Standing out through research and development
In 2017, Hydroline will celebrate its 55th year in business, and it has strong roots in the Kuopio region, where the company’s headquarters are located. All of the company’s research and development activities and a large proportion of its production take place at the production plant in Siilinjärvi.
Research and development is one of the company’s strongest means of differentiation and also a source of pride. The majority of the global players in the sector manufacture high-volume products, while Hydroline specialises in producing solutions for the demanding high end of the market. The company works closely with its customers on research and development. In addition, it has ongoing development projects with universities and research institutes.
One of the newest additions to the product portfolio is Lifecycle Efficiency Online (LEO), a remotely-readable range of cylinders based on IoT technology. The IoT dimension enables proactive maintenance of devices used in extreme conditions, thereby avoiding expensive production stoppages.
Anita Ojala, partner, Juuri Partners Ltd, Tel: +358 40 826 2085, firstname.lastname@example.org
Mikko Laakkonen, CEO, Hydroline Oy, Tel: +358 40 505 1625, email@example.com
Jukka Laakkonen, Chairman of the Board of Directors, Hydroline Oy, Tel: +358 40 709 6117, firstname.lastname@example.org
Juuri Fund I LP is a Finnish private equity investment fund that finances established and profitable small and medium-sized enterprises in Finland. The fund is managed by Juuri Partners Ltd. Juuri Partners offers growth-focused companies a new business development and financing concept that combines active minority ownership, business operation support and debt financing. The fund is currently worth approximately EUR 80 million and has investments from several significant institutional investors from Finland.
Hydroline Oy, a family company, is Finland’s leading specialist in designing, manufacturing and providing life cycle services for hydraulic cylinders intended for demanding applications. The company was founded in Kuopio, Finland in 1962, and it currently has approximately 250 employees. Hydroline’s customers are the world’s leading manufacturers of machinery and equipment in their industries. The company has two production plants, which are located in Siilinjärvi, Finland and Stargard, Poland. In 2016, the company’s net sales were approximately EUR 36 million.