Chemicals distributor from Mönchengladbach, Germany aligns itself to European markets with a new name The Overlack Group was founded in 1922 and today adopts a leading position in the European chemicals distribution market. The group of companies defines itself as a traditional and solid family-owned company with a value-based corporate philosophy that includes reliability, continuity and sustainable growth. It was something of a surprise to learn that the company with headquarters in Mönchengladbach will be presenting itself under a new name from next year. Michael Reubold talked with the CEO Peter Overlack, who is leading the commercial company in its third generation, about the coming rebranding.
CHEManager: Mr Overlack, your company will be gaining a new name – OQEMA. What's the reason behind this change of name?
P. Overlack: Let me tell you right away: we will be continuing our business just as before. we're changing the name but we're not changing ourselves or our methods. OQEMA will remain a family-owned company and our internal structures will also stay as they are. We took the decision for a new brand name in order to give expression to our European vision of the future, and we're aiming to further expand our position as one of the leading distributors for specialities, commodities and services throughout Europe. Absolutely essential for this is to externally present all companies in the Group in a homogenous way. We're currently active with independent companies in 17 countries, and you can perhaps imagine the level of confusion here…
Behind this vision is a double growth strategy: we aim to expand via investment through acquisitions, especially in the European countries where we were not active until now, and also organically by continuously expanding our products and services. We're already networking the expert knowledge of more than 900 employees from all over Europe. These by the way all have an exceedingly high level of personal commitment to make everything possible for our customers. We want to fetch all of these people under a single umbrella namewise. Up until now we had diverse company names within the Group, but for us it's important that all Group companies with their uniform corporate presentation still remain deeply anchored within their regional markets.
We looked for a name that transports our corporate values into the future.
How did the new name of "OQEMA" come about?
P. Overlack: We looked for a name that sounds modern and can be easily remembered, but that simultaneously carries our corporate values into the future. For this reason we retained the "O" from Overlack as a recognition factor. It represents that which made us successful as Overlack – supplying chemical processing companies safely, quickly and reliably with the necessary products, in any quantity, to any location, and always on time. That was always the case and will continue to be so in the future.
"QEM" stands for chemistry, and we intentionally selected the specific spelling of the "Q". We think that personality and a sense of uniqueness are important. You could also say that the "Q" represents "Qaracter", a trait that we particularly value in our employees, partners and clients. Another factor is that this unusual letter in the company name achieves a high level of attention. It has a catchy effect that sticks in the mind and helps the new name to be remembered.
Talking of catchwords: continue to grow. Today the Group has a turnover of around 650 million euros. Which growth strategy have you followed in the past years?
P. Overlack: Actually, it all began in 1988. At that time I talked to the shareholders about the need to expand the company. We were too small to be noticed. As a result we started to expand our regional presence at the beginning of the nineties with very limited means. The fall of the Berlin wall was advantageous here. The countries on the far side of the former GDR were more or less terra incognita, and along with the GDR there was absolutely no operational basis for the Western chemical trade at the time. After the fall of the wall we sat down straight away in September 1990 with our notary to sign and seal the foundation of our Leipzig subsidiary. Something that I'm exceedingly pleased about is that the two "new employees" to whom we owed this new start still work for us to this day. We then progressed to Poland and the Czech Republic and subsequently expanded the entire Eastern European market step-by-step until 2005.
In the second half of the decade after 2000 Overlack was a German company with a strong Eastern European focus. I believed though that the company would be positioned more strongly if we covered all of Europe. Personally, I don't believe you have to have a global setup – the advantages of a global network are almost outweighed or even more than outweighed in my opinion by the inherent organisational complexity. In America and Asia we find regional submarkets that hardly provide any synergy, but Europe is a demarcated submarket that we aim to cover completely.
You just said that you initially tried with very limited means to expand the regional presence of the company. That changed though.
P. Overlack: Yes, it did. The problem with established markets such as Italy, France, Spain and England or even Scandinavia is that long-term competitors with deep roots and mature customer relationships exist there. What functioned for us in Eastern Europe after German reunification wouldn't work there, or would at least be difficult. We were certain of one thing: if we wanted to develop in these countries we needed to acquire, and to acquire in purchase sizes of double-digit millions that we'd never facilitated before at Overlack. And we also knew that we wouldn't manage that with our equity base. We needed private equity.
You decided to work with the Hannover Finanz Group as your equity capital associate.
P. Overlack: That’s right. We'd been looking for a private equity company suitable for medium-sized companies that wanted to accompany us as a partner, and in the beginning of 2015 we succeeded with Hannover Finanz. With the support of the new equity we carried out two acquisitions in the same year with Klink and Lansdowne, which we then consolidated and integrated in 2016. That worked out very well. We've also been rounding this off with smaller acquisitions by our own efforts, and we continue to progress along this path. We've got several smaller activities in this area on our list for 2018 and 2019, and we're approaching two or three larger companies that we could purchase with an additional amount of private equity from the same capital provider. That's not yet at the contract stage though.
This means that the investor is more interested in the long term?
P. Overlack: Yes, Hannover Finanz is the right partner for us – it speaks our language and knows how we think. They're nice people that are sufficiently down-to-earth not to overwhelm a medium-sized company with formalised structures and processes. In that respect we're definitely satisfied at the moment.
CHEManager interview with Peter Overlack, CEO of Overlack AG, about the change of name
(publication period October/November 2017)