The swimming pool builders have a lot to do: More than 30 degrees in the shade and constantly rising high temperatures in Germany and throughout Central and Southern Europe are boosting business. The two Corona years, in which many beach holidays were cancelled, have also increased the demand for large above-ground pools in your own garden.
A German family company is preparing to play an increasingly important role. The CF Group, the second largest swimming pool supplier in Europe, is now taking over the Dutch Starline Group. The company, which is based in Wendlingen near Stuttgart, announced that twelve percent of sales would be added in one fell swoop.
“Together with Starline, we are entering a new dimension,” said Cedrik Mayer-Klenk, CEO of the CF Group. The medium-sized company expects sales of more than 400 million euros this year.
Only the Spanish Fluidra Group is significantly larger with sales of over two billion euros. But the Spaniards only became so big through takeovers. The industry is in a concentration process.
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Impressive growth story of a German family company
“Starline is a geographic expansion, and we’re adding technology that we previously had to buy in,” emphasizes Mayer-Klenk. With Starline, the CF Group is expanding its position on the Belgian, Dutch and British markets.
Based in Valkenswaard in the Netherlands, the eight-brand group specializes in the luxury segment. It has been developing, designing, producing and selling private swimming pools, swimming pool covers and various products for swimming pool technology since 1973. With more than 130 employees and five production sites in the Netherlands, Belgium and Great Britain, Starline generated sales of almost 50 million euros in 2021.
Behind the German growth story lies an unusual entrepreneurial story: 25 years ago, Cedrik Mayer-Klenk bought back the company that his father had sold in 1989.
“I had already worked in the company as a student and always had a connection to the company,” says Mayer-Klenk. He studied technical business administration and worked for a consultant for two years before joining the company in 1997, which at the time belonged to a non-family entrepreneur.
The CF Group CEO continues to drive the company’s growth.
(Photo: CF Group)
Shortly thereafter, the company was taken over, which at the time generated sales of almost six million Deutschmarks. However, getting started was not easy: “The first time we visited the largest customer at the time, things got straight to the point,” recalls the 51-year-old entrepreneur. “Your predecessor cheated us for years. Cut prices by 21 percent or you’re out of business,” he snapped.
Before he knew it, he had lost the major customer and with it 15 percent of his turnover. He needed the money to be able to pay his then 14 employees.
But after the difficult initial phase things went slowly but steadily upwards – at that time still under the name Chemoform.
Bank subsidiary on board
In 2019, Cedrik Mayer-Klenk once again increased the pace significantly. The manager, who grew up bilingual thanks to his French mother, joined forces with the French family company FIJA, a manufacturer and B2B distributor of pool equipment. This is how the CF Group was born, one of the leading companies in the field and in water treatment consumables.
The group of companies is now represented in more than 40 countries with 15 brands and twelve production and logistics locations.
For a medium-sized company, the CEO’s approach to expansion was rather unusual. With an equity ratio of 45 percent, he could have financed the deal through banks. “But that was too risky for me,” says the CF boss.
He preferred to take on board Crédit Mutuel Equity, the subsidiary of the banking group Crédit Mutuel Alliance Fédérale. “Crédit Mutuel Equity contributed equity, market knowledge and professional advice on M&A processes,” says Mayer-Klenk.
Now the next step has followed in the Benelux countries – and it should not be the last acquisition. Once again, capital comes from the French direct investment company. “Since our entry almost three years ago, the CF Group has grown organically by around 30 percent and has significantly consolidated its position in the top three swimming pool suppliers in Europe,” says Sébastien Neiss, Managing Director of Crédit Mutuel Equity in Germany.
Unusual allocation of shares
The bank subsidiary, which holds shares in 350 companies with a total capital volume of 3.8 billion euros, wants to accompany this path. Although only seven of these companies are in Germany, the French want to “significantly expand” their German business, as Neiss emphasizes.
The investment company will hold twelve percent of the CF Group in the future. The French don’t want to make a quick euro, but in the end they want to earn more by participating in the company’s growth than if the bank had just given them a loan.
“As an investor who only invests equity from our banking group, we have the opportunity to accompany our portfolio companies for any length of time and let our investment grow with the company,” assures Neiss.
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Mayer-Klenk continues to hold two thirds of the shares in the CF Group. Another ten percent belong to two private investors. The remaining eleven percent is held by Christoph Mayer-Klenk, who does not work in the company: Cedric Mayer-Klenk’s brother is CEO of Sandmaster, a manufacturer of sand cleaning machines.
In turn, Cedrik Mayer-Klenk holds a minority stake in Sandmaster. The companies of the two brothers are involved crosswise. But everyone does their own business.
Prepare for the downside
As much as the beautiful weather and high temperatures are driving pool demand, the progressing climate change is also throwing its downsides on the industry. Extremely high energy prices and water shortages in southern Europe are taking their toll.
Not only could they slow down the swimming pool business, they could even bring it into disrepute. CF boss Mayer-Klenk knows about the problem and therefore wants to secure acceptance with his own resources.
“We are developing energy self-sufficient swimming pools with heat pumps, solar thermal energy, solar power and special covers,” emphasizes the CEO. However: In southern Europe, the covers would have to be removed from pools at night in summer so that the water cools down.
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