Hydro International, the innovative developer of products for the global water industry, is forecasting strong growth after being acquired by pan-European private equity firm Agilitas.
The Clevedon-based company has operated in the water management sector since the 1980s, specialising in advanced products that treat wastewater and control stormwater. Its customers span the municipal, industrial and construction sectors. 
Bristol-headquartered law firm Burges Salmon and the city office of FRP Advisory were among the advisors on the deal, which new owner Agilitas said would take Hydro to the next level in its international expansion.
Agilitas, which was founded in 2011, invests in mid-market businesses, creating long-term value through business transformation. It has invested in businesses in the healthcare, waste management and environmental technologies sector in the UK, Scandinavia and France.
It has acquired Hydro from Hanover Investments, which bought the firm for around £29m in 2016, taking it private and delisting it from the London Stock Exchange’s AIM market.
Financial details of the Agilitas takeover, backing for which was provided by international funder EQT Credit and Lloyds Bank, have not been disclosed.
Agilitas managing partner Martin Calderbank said: “We see Hydro as an opportunity to invest in a clear technology leader in a growing sector that answers a fundamental need.”
He said water management was an area of increasing government focus, as water scarcity grows in importance as a global issue, linked to increased population size, growing urbanisation and climate change.
Agilitas partner Torbjorn Midsem, who has joined the Hydro board, added: “We look forward to supporting the Hydro management team to build on the positive momentum in the business, to bring it to the next level through further geographic expansion, and through the extension of its services and products.
As well as its head office and research and development arm in Clevedon, Hydro also has significant US operations. It employs 219 staff, predominantly in the UK and in Maine and Oregon in the US, where it acquired California-based filtration technology developer M2 Renewables in 2015.
Hydro’s wastewater division provides products and services for treatment plants and is the US technology leader in grit removal equipment, while its stormwater division focuses on stormwater run-off particularly in urban areas.
Former Hydro chief executive Michael Jennings, who quit last year, returns to the business as non-executive chairman as part of the Agilitas deal.
He said: “I am excited by the opportunity to work alongside Agilitas to continue the development of the company into a diversified provider of wastewater and stormwater products and services.”
Partner Mark Naughton and associate director Alex Sargeant of FRP Advisory provided corporate finance advice to Hydro’s management team alongside legal and tax advice from a cross-firm team of corporate, employment and tax lawyers from Burges Salmon, led by corporate partner Mark Shepherd and associate lawyer Alex Lloyd.
Mark Naughton, pictured above, said: “It has been a pleasure to work with the senior management team in the UK and US and support them in their discussions with Agilitas. The team have exciting plans for the business and we wish them well for the future.”
Mark Shepherd, pictured right, added: “The senior management team at Hydro International have been instrumental in its success to date. We are delighted to have had the opportunity to work with them at the outset of this new chapter in Hydro’s continued success and look forward to seeing the business go from strength to strength with Agilitas’ support.”
Hydro International director Roger Crook said: “We are very grateful to Burges Salmon and FRP for the seamless support that they have provided to us, the management team. They have been a pleasure work with and their expertise, coupled with a pragmatic and directional approach, have been invaluable in guiding us through this transaction with Agilitas.”
US tax advice was provided by Thompson Hine, part of the Burges Salmon preferred firm network.
EQT partner Paul Johnson said: “We are thrilled to support Agilitas in their acquisition of Hydro International, an international company that has demonstrated industry leading and technologically differentiated product and services for the water management industry.
“We look forward to supporting the Company and the management team under Agilitas’ ownership.”
Agilitas was advised by William Blair (buy-side and debt advisory), PWC (financial), KPMG (tax), CIL Management Consultants (commercial), Amane Advisors (sector and technology), Ashurst (legal), Mercer (HR) and Marsh (insurance).
